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Rev. date: 01/01/2011

First-Time Homebuyer Credit – Purchases Made In 2009, 2010 And 2011

Tax Topic 612
The Housing and Economic Recovery Act of 2008 created a new refundable tax credit, beginning in 2008, for individuals who are qualified first-time homebuyers of a principal residence in the United States. Tax Topic 611 explains the general rules that apply to this credit for 2008. The American Recovery and Reinvestment Act of 2009, the Worker, Homeownership, and Business Assistance Act of 2009, and the Homebuyer Assistance and Improvement Act of 2010 made changes to the credit for qualified purchases made in 2009 and 2010. First-time homebuyers who buy a home after December 31, 2008, and before May 1, 2010, can claim a refundable credit of 10% of the homes purchase price, up to $8,000 ($4,000 for married filing separately). Taxpayers who enter into a binding written contract before May 1, 2010, to close on the purchase before July 1, 2010, can also claim the credit if they close before October 1, 2010.
General Rules For Purchases Made in 2009 or 2010:
Special Rules For Qualified Purchases Made After November 6, 2009:
Special Rule for Members of the Armed Forces: Members of the Armed Forces have until April 30, 2011 (or June 30, 2011, for taxpayers who entered into a binding contract before May 1, 2011) to purchase a home if they (or their spouse if married) were on qualified official extended duty outside the United States for at least 90 days during the period beginning after December 31, 2008, and ending before May 1, 2010.
For more information on the new rules for 2009 and 2010 you may refer to the following references on the IRS website at The Form 5405 Instructions, news releases, including 2009 IRS News Release (IR-2009-14, Feb. 25, 2009), First-Time Homebuyer Credit: Questions and Answers, and additional topics on this subject.