New marriage, first home and taxes

NEW YORK (Money Magazine) -- Q. My son and his fiancée, who are getting married this month, bought a home last year. She had owned a home before, but he had not. Is he still eligible for the $7,500 first-time homebuyer tax credit?

Carolyn Bigda, staff writer, says ...

A. It's likely that he is. Last year's housing act offered a credit of 10% of the home's price, up to a maximum of $7,500, to homebuyers who had not owned a principal residence for the past three years. Married couples must both meet the criteria to claim the credit, but an unmarried joint purchaser can still claim it, even if the other buyer doesn't qualify.

There are a couple of other eligibility requirements to consider too.

Your son's home must have been purchased after April 8, 2008, to qualify, and his income must be $75,000 a year or less to claim the full amount (for married couples it's $150,000 or less).

Finally, under the 2008 law this credit has strings attached: It is to be repaid over a 15-year period (the 2009 stimulus package upped the credit to $8,000 and waived the repayment rule for homes purchased from January through November 2009).

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