While these opportunities are not likely to be available to Aspiriant’s clients directly because of the income limitations, they could be interesting for some children of our clients or other family members.
First-Time Homebuyer Tax Credit Advance
The First Time Homebuyer Credit (up to $8,000 for taxpayers qualifying under certain income ceilings) can be used as additional down payment funds by FHA borrowers. This advance cannot be used to meet the 3.5% minimum down payment required by FHA, or result in cash back to the borrower, but can be applied against other escrow charges. Several state (CO, DE, ID, KY, MO, NJ, NM, OH, PA and TN) housing agencies offer similar programs to homebuyers.
New Car Purchases in States with No Sales Tax
Taxpayers under certain income ceilings can deduct sales taxes paid on the purchase of a qualified motor vehicle on their 2009 income tax returns. This deduction is available whether the taxpayer otherwise itemizes deductions or not. Recently, the IRS announced that purchasers of such vehicles in states that do not have sales taxes will be allowed a similar deduction for state or local government fees assessed on the purchase of the vehicle, to the extent that they are based on the first $49,500 of the vehicle’s sales price.