Sunday, November 8th, 2009

How does a tax credit effect a tax return?

tax credit
lyndsey7323 asked:


I usually get about $3,000.00 total for state and federal tax returns. I bought my first home in 2009 so I am eligible for the federal tax credit being offered. Just wondering roughly how much extra I can expect in my tax return in 2010. Anyone know?

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3 Responses to “How does a tax credit effect a tax return?”

Jesse H Says:
November 9th, 2009 at 9:15 pm

The greater of 10% of purchase price or $8,000. If you usually get $3,000 back then you’ll have $11,000.

Lisa Says:
November 10th, 2009 at 9:57 am

You can count on $8000 due to the first-time home buyers credit. You will also be able to deduct for the interest that you have paid this year on your mortgage, and possibly some of your home improvements.
When it comes time for you to do your taxes, I would suggest going to a local professional, not one of the H&R blocks or anything like that, but a legitimate year round local accountant in your area. It will cost a small amount, but you would likely get the best return on your taxes if a real professional prepares for you.

tro Says:
November 13th, 2009 at 6:58 am

it depends on when you bought the house, if the mortgage interest and property taxes plus your other itemized deductions do not exceed your standard deduction, for this year it will mean nothing
you will have the FTHB credit coming however
in 2010 with a full year of mortgage payments, your itemized deductions will definitely be changed

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