On the 6th of November the first time home buyer’s credit has been extended and liberalized through the Worker, Homeownership, and Business Assistance Act of 2009. There’s reason for you to rejoice but just wait. There are certain things that you should know about this act.

• As expected the home purchase deadline has been extended till the 30th of November next year for all the principal residences of the United States.. If on that date your purchase is in the middle of a deal you can expect your deadline to be relaxed for a couple of months from then.
• If you are an existing homeowner who bought a replacement of the US principle residence after the sixth of November this year, you qualify for the tax credit though it’s a reduced one.
• The first time home buyers as defined by the federation earlier still get huge credits- the much popular $8000 credit which you are already aware of.
• Even high income groups can avail the home buyer credits now. Earlier the upper income limit for availing this credit was pretty low but now the upper limit has been raised so that people with higher incomes can take part in the program. This comes as a relief to the higher income group. Earlier, the phase out range for unmarried individuals and married people who live separately has been $75,000 and $ 95, 000 respectively, but now, those who’ve made purchases after the 6th of November this year,  the phase out range has been lifted to $ 125,000 and $ 145,000  MAGI respectively. For married joint filers the phase out range has been raised from $150,000- $170,000 to $ 225,000 – $ 245,000 MAGI.
• For properties purchased after the 6th of November, their cost should be less than $800,000 for you to avail the tax credit.
• Children and dependents do not qualify for the credit for properties that are bought after the 6th of November this year. You should be at least 18 years old and should not be dependent on anyone for your finances. You should not be dependent as per the 1040 FORM when you purchase the property. This has been done to stop people from claming credits on the name of young buyers who are actually dependent on their parents for their monetary requirements. There are so many children today who are claiming credits for buying a lodge near their colleges.
• As in all businesses the tax credit program is seeing quite a lot of fraudulency when it comes to claiming the $8000 tax return. People who already own properties are fraudulently claiming the returns. For this reason, now you’ve to submit real estate documentation to substantiate your claim. When the government is giving returns even when you show no income why people should resort to fraudulency?
• The new law allows you to claim credits on your previous year’s returns. So you can claim on your 2008 returns this year and also for next year on your Form 1040 of this year. This allows you to get credits sooner than you can expect. Also if you have a higher income than at the time you purchased you still can claim the credit.