26 U.S.C. § 36
In the case of an individual who is a first-time homebuyer of a principal residence in the United States during a taxable year, there shall be allowed as a credit against the tax imposed by this subtitle for such taxable year an amount equal to 10 percent of the purchase price of the residence.
Except as otherwise provided in this paragraph, the credit allowed under subsection (a) shall not exceed $8,000.
In the case of a married individual filing a separate return, subparagraph (A) shall be applied by substituting "$4,000" for "$8,000".
If two or more individuals who are not married purchase a principal residence, the amount of the credit allowed under subsection (a) shall be allocated among such individuals in such manner as the Secretary may prescribe, except that the total amount of the credits allowed to all such individuals shall not exceed $8,000.
In the case of a taxpayer to whom a credit under subsection (a) is allowed by reason of subsection (c)(6), subparagraphs (A), (B), and (C) shall be applied by substituting "$6,500" for "$8,000" and "$3,250" for "$4,000".
The amount allowable as a credit under subsection (a) (determined without regard to this paragraph) for the taxable year shall be reduced (but not below zero) by the amount which bears the same ratio to the amount which is so allowable as-
For purposes of subparagraph (A), the term "modified adjusted gross income" means the adjusted gross income of the taxpayer for the taxable year increased by any amount excluded from gross income under section 911, 931, or 933.
No credit shall be allowed under subsection (a) for the purchase of any residence if the purchase price of such residence exceeds $800,000.
No credit shall be allowed under subsection (a) with respect to the purchase of any residence unless the taxpayer has attained age 18 as of the date of such purchase. In the case of any taxpayer who is married (within the meaning of section 7703), the taxpayer shall be treated as meeting the age requirement of the preceding sentence if the taxpayer or the taxpayer's spouse meets such age requirement.
For purposes of this section-
The term "first-time homebuyer" means any individual if such individual (and if married, such individual's spouse) had no present ownership interest in a principal residence during the 3-year period ending on the date of the purchase of the principal residence to which this section applies.
The term "principal residence" has the same meaning as when used in section 121.
The term "purchase" means any acquisition, but only if-
A residence which is constructed by the taxpayer shall be treated as purchased by the taxpayer on the date the taxpayer first occupies such residence.
The term "purchase price" means the adjusted basis of the principal residence on the date such residence is purchased.
A person shall be treated as related to another person if the relationship between such persons would result in the disallowance of losses under section 267 or 707(b) (but, in applying section 267(b) and (c) for purposes of this section, paragraph (4) of section 267(c) shall be treated as providing that the family of an individual shall include only his spouse, ancestors, and lineal descendants).
In the case of an individual (and, if married, such individual's spouse) who has owned and used the same residence as such individual's principal residence for any 5-consecutive-year period during the 8-year period ending on the date of the purchase of a subsequent principal residence, such individual shall be treated as a first-time homebuyer for purposes of this section with respect to the purchase of such subsequent residence.
No credit under subsection (a) shall be allowed to any taxpayer for any taxable year with respect to the purchase of a residence if-
If the Secretary requires information reporting under section 6045 by a person described in subsection (e)(2) thereof to verify the eligibility of taxpayers for the credit allowable by this section, the exception provided by section 6045(e) shall not apply.
Except as otherwise provided in this subsection, if a credit under subsection (a) is allowed to a taxpayer, the tax imposed by this chapter shall be increased by 62/3 percent of the amount of such credit for each taxable year in the recapture period.
If a taxpayer disposes of the principal residence with respect to which a credit was allowed under subsection (a) (or such residence ceases to be the principal residence of the taxpayer (and, if married, the taxpayer's spouse)) before the end of the recapture period-
In the case of the sale of the principal residence to a person who is not related to the taxpayer, the increase in tax determined under paragraph (2) shall not exceed the amount of gain (if any) on such sale. Solely for purposes of the preceding sentence, the adjusted basis of such residence shall be reduced by the amount of the credit allowed under subsection (a) to the extent not previously recaptured under paragraph (1).
Paragraphs (1) and (2) shall not apply to any taxable year ending after the date of the taxpayer's death.
Paragraph (2) shall not apply in the case of a residence which is compulsorily or involuntarily converted (within the meaning of section 1033(a)) if the taxpayer acquires a new principal residence during the 2-year period beginning on the date of the disposition or cessation referred to in paragraph (2). Paragraph (2) shall apply to such new principal residence during the recapture period in the same manner as if such new principal residence were the converted residence.
In the case of a transfer of a residence to which section 1041(a) applies-
In the case of any credit allowed with respect to the purchase of a principal residence after December 31, 2008-
In the case of the disposition of a principal residence by an individual (or a cessation referred to in paragraph (2)) after December 31, 2008, in connection with Government orders received by such individual, or such individual's spouse, for qualified official extended duty service-
For purposes of this section, the term "qualified official extended duty service" means service on qualified official extended duty as-
Any term used in this subparagraph which is also used in paragraph (9) of section 121(d) shall have the same meaning as when used in such paragraph.
In the case of a credit allowed under subsection (a) with respect to a joint return, half of such credit shall be treated as having been allowed to each individual filing such return for purposes of this subsection.
If the tax imposed by this chapter for the taxable year is increased under this subsection, the taxpayer shall, notwithstanding section 6012, be required to file a return with respect to the taxes imposed under this subtitle.
For purposes of this subsection, the term "recapture period" means the 15 taxable years beginning with the second taxable year following the taxable year in which the purchase of the principal residence for which a credit is allowed under subsection (a) was made.
In the case of a purchase of a principal residence after December 31, 2008, a taxpayer may elect to treat such purchase as made on December 31 of the calendar year preceding such purchase for purposes of this section (other than subsections (b)(4), (c), (f)(4)(D), and (h)).
This section shall only apply to a principal residence purchased by the taxpayer on or after April 9, 2008, and before May 1, 2010.
In the case of any taxpayer who enters into a written binding contract before May 1, 2010, to close on the purchase of a principal residence before July 1, 2010, and who purchases such residence before October 1, 2010, paragraph (1) shall be applied by substituting "October 1, 2010" for "May 1, 2010".
In the case of any individual who serves on qualified official extended duty service (as defined in section 121(d)(9)(C)(i)) outside the United States for at least 90 days during the period beginning after December 31, 2008, and ending before May 1, 2010, and, if married, such individual's spouse-
26 U.S.C. § 36
EDITORIAL NOTES
PRIOR PROVISIONSA prior section 36 was renumbered section 37 of this title.Another prior section 36, acts Aug. 16, 1954, ch. 736, 68A Stat. 15; Oct. 4, 1976, Pub. L. 94-455, title V, §501(b)(2), title X, §1011(c), title XIX, §1901(b)(1)(A), 90 Stat. 1558, 1611, 1790, directed that credits provided by section 32 not be allowed if an individual elects under section 144 to take standard deduction, prior to repeal by Pub. L. 95-30, title I, §§101(d)(3), 106(a), May 23, 1977, 91 Stat. 133, 141, applicable to taxable years beginning after Dec. 31, 1976.
AMENDMENTS2010-Subsec. (h)(2). Pub. L. 111-198, §2(a), substituted "and who purchases such residence before October 1, 2010, paragraph (1) shall be applied by substituting 'October 1, 2010' " for "paragraph (1) shall be applied by substituting 'July 1, 2010' ". Subsec. (h)(3)(B). Pub. L. 111-198, §2(b), inserted ", and for 'October 1, 2010' " after "for 'July 1, 2010' ". 2009-Subsec. (b)(1)(A). Pub. L. 111-5, §1006(b)(1), substituted "$8,000" for "$7,500".Subsec. (b)(1)(B). Pub. L. 111-5, §1006(b), substituted "$4,000" for "$3,750" and "$8,000" for "$7,500". Subsec. (b)(1)(C). Pub. L. 111-5, §1006(b)(1), substituted "$8,000" for "$7,500".Subsec. (b)(1)(D). Pub. L. 111-92, §11(c)(1), added subpar. (D).Subsec. (b)(2)(A)(i)(II). Pub. L. 111-92, §11(c)(2), substituted "$125,000 ($225,000" for "$75,000 ($150,000".Subsec. (b)(3). Pub. L. 111-92, §11(d), added par. (3).Subsec. (b)(4). Pub. L. 111-92, §12(a)(1), added par. (4).Subsec. (c)(3)(A)(i). Pub. L. 111-92, §12(c), inserted "(or, if married, such individual's spouse)" after "person acquiring such property".Subsec. (c)(6). Pub. L. 111-92, §11(b), added par. (6).Subsec. (d). Pub. L. 111-5, §1006(d)(2), (e), redesignated pars. (3) and (4) as (1) and (2), respectively, and struck out former pars. (1) and (2) which read as follows:"(1) a credit under section 1400C (relating to first-time homebuyer in the District of Columbia) is allowable to the taxpayer (or the taxpayer's spouse) for such taxable year or any prior taxable year,"(2) the residence is financed by the proceeds of a qualified mortgage issue the interest on which is exempt from tax under section 103,".Subsec. (d)(3). Pub. L. 111-92, §11(g), added par. (3).Subsec. (d)(4). Pub. L. 111-92, §12(b), added par. (4).Subsec. (f)(4)(D). Pub. L. 111-92, §11(a)(2), inserted "and 2010" after "2009" in heading and struck out ", and before December 1, 2009" after "December 31, 2008" in introductory provisions. Pub. L. 111-5, §1006(c)(1), added subpar. (D).Subsec. (f)(4)(E). Pub. L. 111-92, §11(e), added subpar. (E).Subsec. (g). Pub. L. 111-92, §12(a)(2), inserted "(b)(4)," before "(c)". Pub. L. 111-92, §11(a)(3), amended subsec. (g) generally. Prior to amendment, text read as follows: "In the case of a purchase of a principal residence after December 31, 2008, and before December 1, 2009, a taxpayer may elect to treat such purchase as made on December 31, 2008, for purposes of this section (other than subsections (c) and (f)(4)(D))." Pub. L. 111-5, §1006(a)(2), (c)(2), substituted "December 1, 2009" for "July 1, 2009" and "subsections (c) and (f)(4)(D)" for "subsection (c)".Subsec. (h). Pub. L. 111-92, §11(a)(1), substituted "May 1, 2010" for "December 1, 2009", designated existing provisions as par. (1), inserted heading, and added par. (2). Pub. L. 111-5, §1006(a)(1), substituted "December 1, 2009" for "July 1, 2009".Subsec. (h)(3). Pub. L. 111-92, §11(f), added par. (3).
STATUTORY NOTES AND RELATED SUBSIDIARIES
EFFECTIVE DATE OF 2010 AMENDMENT Pub. L. 111-198, §2(c), July 2, 2010, 124 Stat. 1356, provided that: "The amendments made by this section [amending this section] shall apply to residences purchased after June 30, 2010."
EFFECTIVE DATE OF 2009 AMENDMENT Pub. L. 111-92, §11(j)(1) -(3), Nov. 6, 2009, 123 Stat. 2991, provided that:"(1) IN GENERAL.-The amendments made by subsections (b), (c), (d), and (g) [amending this section] shall apply to residences purchased after the date of the enactment of this Act [Nov. 6, 2009]."(2) EXTENSIONS.-The amendments made by subsections (a) [amending this section], (f) [amending this section], and (i) [amending section 1400C of this title] shall apply to residences purchased after November 30, 2009."(3) WAIVER OF RECAPTURE.-The amendment made by subsection (e) [amending this section] shall apply to dispositions and cessations after December 31, 2008." Pub. L. 111-92, §12(e), Nov. 6, 2009, 123 Stat. 2992, provided that: "(1) IN GENERAL.-Except as otherwise provided in this subsection, the amendments made by this section [amending this section and section 6213 of this title] shall apply to purchases after the date of the enactment of this Act [Nov. 6, 2009]."(2) DOCUMENTATION REQUIREMENT.-The amendments made by subsection (b) [amending this section] shall apply to returns for taxable years ending after the date of the enactment of this Act [Nov. 6, 2009]."(3) TREATMENT AS MATHEMATICAL AND CLERICAL ERRORS.-The amendments made by subsection (d) [amending section 6213 of this title] shall apply to returns for taxable years ending on or after April 9, 2008."Pub. L. 111-5, div. B, title I, §1006(f), Feb. 17, 2009, 123 Stat. 317, provided that: "The amendments made by this section [amending this section and section 1400C of this title] shall apply to residences purchased after December 31, 2008."
EFFECTIVE DATESection applicable to residences purchased on or after Apr. 9, 2008, in taxable years ending on or after such date, see section 3011(c) of Pub. L. 110-289, set out as an Effective Date of 2008 Amendment note under section 26 of this title.
- Secretary
- The term "Secretary" means the Secretary of the Treasury or his delegate.
- joint return
- The term "joint return" means a single return made jointly under section 6013 by a husband and wife.
- person
- The term "person" shall be construed to mean and include an individual, a trust, estate, partnership, association, company or corporation.
- taxable year
- The term "taxable year" means the calendar year, or the fiscal year ending during such calendar year, upon the basis of which the taxable income is computed under subtitle A. "Taxable year" means, in the case of a return made for a fractional part of a year under the provisions of subtitle A or under regulations prescribed by the Secretary, the period for which such return is made.
- taxpayer
- The term "taxpayer" means any person subject to any internal revenue tax.