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Congress Extends First-Time Homebuyers Tax Credit

The U.S. House of Representative and the U.S. Senate adopted an extension of the home buyer tax credit which was due to expire on December 1. The extension runs until June 30, 2010. The tax credit applies to purchasers of manufactured homes, including both 'home only' and 'land/home' transactions. First-time homebuyers may claim a credit of up to $8000 if their annual income is less than $125,000 for individuals, and less than $225,000 for couples. In addition, the plan would allow a $6,500 tax credit for move-up home buyers who purchase a primary residence if they owned their current home for at least 5 consecutive years in the previous 8 years. President Obama is expected to sign the extension into law this week-end.

This represents a huge victory for MHI and its members. Starting with the MHI Summer Meeting in Washington last June, MHI members have been communicating to their Members of Congress the importance of the home buyer tax credit to our industry and the necessity of extending it. Hopefully, the extension of the tax credit through the middle of next year will encourage home buyers to purchase manufactured homes in significant numbers. Source: Manufactured Housing Institute

First-Time Homebuyer Tax Credit Frequently Asked Questions

On February 17, 2009, President Obama signed legislation that revises and extends the tax credit provisions of The Housing and Economic Recovery Act of 2008 - H.R. 3221. Section 36 of The Act established a First-Time Homebuyer Tax Credit for qualified purchasers. The Tax Credit will continue to be administered by the IRS and provides a reduction in the tax liability of a home buyer in the year the credit is claimed. This flyer highlights some key provisions of the credit. For additional information please go to www.federalhousingtaxcredit.com. The Alabama Manufactured Housing Association recognizes that each homebuyer has specific tax circumstances and homebuyers should consult with a qualified tax advisor.

Frequently Asked Questions

What is the First-Time Homebuyer Tax Credit? A federal income tax credit of 10% of the purchase price, up to $8,000.00, for first-time homebuyers.

What is the definition of a first-time homebuyer? The law defines "first-time home buyer" as a buyer who has not owned a principal residence during the three-year period prior to the purchase. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse.

Who is eligible to claim the credit? Qualified first-time homebuyers purchasing any kind of home; new or resale.

What type of homes qualify? Any home purchased by an eligible first-time homebuyer which is used as a principal residence; no second or vacation homes. The home can be a manufactured or modular home and can be on your land or leased land.

Are there income limits? Yes. Modified adjusted gross income of up to $75,000 for a single or head of household buyer or $150,000 for married, joint tax filers.

If my income is above the limit, do I still qualify for credit? Possibly. A partial credit is available for some, subject to phase-out limits. Complete IRS Form 5405 to determine the size of your credit.

Are there any circumstances in which qualified homebuyers may not receive the maximum $8,000 credit? In general, the credit is equal to 10% of the purchase price, but is capped at $8,000 for homes purchased in 2009.

I heard the credit is refundable. What does that mean? Refundable means that it can be claimed even if the taxpayer has little or no federal income tax liability to offset. Should that be the case, the IRS will issue a check to the homebuyer for the difference between the tax due and the amount of the tax credit.

Does the tax credit have to be paid back to the government? There will be no repayment for purchases on or after January 1, 2009 and before December 31, 2009, if the home is not sold for three years.

I heard there is a "recapture" feature in the provision. What does that mean? If the home is sold within three years of purchase, the entire amount of the credit will be recaptured upon sale for homes purchased during 2009.

How do you claim the credit? On line 69 of Form 1040, enter the amount of the credit as determined by filling out Form 5405. The credit will generally be equal to 10% of the purchase price, up to a maximum of $8,000.

Is a tax credit the same as a tax deduction? No. A tax credit is a dollar-for-dollar reduction in what the taxpayer owes. That means a taxpayer who owes $8,000 in income taxes and who receives an $8,000 tax credit would owe nothing to the IRS.

DISCLAIMER: The information provided here is not intended, and should not be construed, to be legal, tax or investment advice. Before taking any action you are strongly encouraged to, and should, consult with a qualified legal, tax and/or investment professional to whom you have provided all pertinent facts and information as to your individual situation. In addition, this flyer is intended for general information only and, as such, is provided with no guarantee as to its timeliness, completeness or accuracy. This information is based on a new federal law; laws can change at any time.

New FHA Title I Loan Limits Effective Immediately

Any current FHA Title I lender will be eligible to originate loans under the increased Title I loan limits. **Please note that the remaining changes to the Title I program, including underwriting guidelines and new insurance system, will become effective at a later date and will remain a top focus for MHI in the coming weeks.

MHI has strongly advocated for the loan limit increases and for expedited Title I implementation, as well as for lifting the moratorium on Ginnie Mae Title I issuers, to advance liquidity for manufactured home lending.

Thanks to all of our members and state association partners for their assistance in getting the loan limits increased as quickly as possible.Article courtesy of MHI

Moving A Manufactured Home?

Alabama State Law requires your mobile or manufactured home be moved and installed by a licensed, trained installer. This is for your safety, in order to ensure the correct installation.

The Alabama Manufactured Housing Commission trains and licenses certified installers. To see if your installer is licensed or for a list of installers, you can contact the AMHC at (334) 242-4036, or go to their website at www.amhc.state.al.us.

Owning your own home

It's the ultimate American dream. In fact, buying a home is probably the most important purchase you'll make in your lifetime.

As housing costs continue to climb, home ownership is simply beyond the financial reach of a growing number of Americans. Increasingly, the need for more affordable and efficient homes is being met by today's manufactured homes. Manufactured Housing offers all the qualities and amenities you want at a price you can afford.

If you have any additional questions or would like to see how beautifully manufactured homes can fit your lifestyle, find out more here about homeownership or visit a local Alabama Manufactured Housing Association retailer.