Upon the signing of the American Recovery and Reinvestment Act of 2009 (otherwise known as the “2009 economic stimulus plan” or “government stimulus package”), certain United States taxpayers became eligible for an $8,000 tax credit upon the purchase of a home. Taxpayers must use IRS Form 5405 to claim the credit.
1st Time Home Buyer Tax Credit- Last Day to Buy a House in 2009 is November 30th
Individuals in the U.S. who wish to take advantage of this tax incentive must take action in 2009. The last day they can buy a house and still qualify for this tax credit is November 30, 2009. The instructions to Form 5405 are slightly misleading. The instructions read that the home must be purchased “before December 1, 2009.” Technically, this means that the home purchase must be made on or before November 30, 2009, which is the last day “before December 1, 2009.” November 30, 2009 falls on a Monday.
Deadline to Claim $8,000 First Time Homebuyer Tax Credit Using IRS Form 5405
In order to claim the $8,000 first time homebuyer tax credit, U.S. individuals should file Form 5405 along with a 2008 or 2009 individual income tax return. For most people, this means Form 1040. The original tax return deadlines for those two returns are April 15, 2009 and April 15, 2010, respectively. With a properly filed six-month extension, the extended due date of a 2008 tax return (originally due April 15th) is October 15, 2009; a 2009 individual return originally due on April 15th can be extended until October 15, 2010.
What If You’ve Already Filed for 2008? Amend or Wait Until 2009 Federal Tax Return Is Due
An individual who already filed a 2008 Form 1040 in early 2009 does not have to wait until next year to claim the $8,000 first time home buyer tax credit. The person’s original 2008 tax return can be amended immediately. Alternatively, those who anticipated purchasing a home this summer and filed a 2008 tax return extension simply need to file their federal tax returns by the extended due date.
Finally, anyone who has already filed a 2008 tax return and would rather not amend it may wait and claim the credit with a 2009 individual income tax return. This option would make sense especially for those who may not have qualified for the full credit based on 2008 income, but might qualify for 2009 due to slightly lower expected income.
Related article:
7,500 & $8,000 First-Time Homebuyer Tax Credits- learn about the original $7,500 tax break and the updated 8k version per the 2009 economic stimulus plan.
Resources:
IRS website, irs.gov
Revised Form 5405, First-Time Homebuyer Credit
Disclaimer: This article is not a comprehensive source of information about the $8,000 first time home buyer tax credit. Taxpayers may obtain further information from the IRS website and the instructions to Form 5405.
Lena Gott - Lena Gott is a Certified Public Accountant who gives practical financial advice to her readers.
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