Home Buyer Tax Credits

If you purchased a home in 2008, 2009 or 2010, you may be able to take advantage of the first-time homebuyer credit. Here's what you need to know:

• The credit only applies to homes used as a taxpayer's principal residence.
• It reduces a taxpayer's tax dollar for dollar.
• The credit is refundable. This means the credit will be paid to eligible taxpayers, even if they owe no tax or the credit is more than the tax owed.

You will need to file a Form 5405 with your return. If you have already filed and did not take advantage of the credit, you can amend your return with a Form 1040X. You will also need to provide documentation such as a HUD-1 or settlement statement. Be sure to check with your CPA or tax advisor.

For more details, check out this page on the IRS website.