Potential of the Federal Tax Credit

Potential of the Federal Tax Credit

Prospective home buyers and real estate professionals are optimistic about the positive potential of the federal tax credit of up to $8,000 for first-time home buyers. The credit is 10 percent of the home's purchase price, up to $8,000. It applies to all new and existing homes purchase before December 1.

First-time buyers are defined as those who have not owned a home within the past three years. To qualify, individuals cannot earn more than $75,000 per year - couples may earn up to $150,000. The credit does not need to be repaid if the home is owned and occupied by the tax payer for at least three years.