You do not get the tax credit when you close on your house. You get the tax credit when you file your federal income taxes for the year 2008, 2009, or 2010, depending on when you buy your home.
For homes bought in 2008, you claim the credit on your 2008 tax return or amended 2008 tax return.
For homes bought in 2009, you can:
- claim the credit on your 2009 tax return
- file an amended 2008 tax return to claim the credit
For homes bought in 2010, you can:
- claim the credit on your 2009 tax return filed by April 15, 2010
- file an amended 2009 tax return to claim the credit
- or claim the credit on your 2010 tax return
Eligible homebuyers with MassHousing mortgages can borrow against the tax credit without interest to pay their down payment or closing costs. See MassHousing Homebuyer Tax Credit Loan Program.
The 2008-2009-2010 homebuyer tax credits are refundable credits that can lower the amount of federal income taxes you owe or give you a cash payment:
- If your credit is less than you owe in taxes, the credit lowers your tax liability dollar for dollar
- If your credit is more than you owe in taxes, the government pays you the difference
- If you do not owe any federal income tax, the government pays you the full credit amount
You must file a federal income tax return to get the credit, even if you don’t owe any income taxes.