Funny we didn't know that the credit was 10% of the purchase price until ammending 2008 return. Our CPA didn't quote anything less than $8000. even when we discussed the fact that it, 'seemed too good to be true' - we were assured it was 'true'.

To top things off, we also learned that if you are buying the home with more than one person, the eligible party receives only their % portion of the credit.

Can anyone discredit this? I'm hoping it's a myth!

I also misposted a message under 'Filing Requirements' that is related to this same issue.

You are correct in noting that "the tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $8,000."

Also, in a situation where there are multiple buyers, "the buyers can allocate the tax credit in any reasonable manner, provided neither claims a tax credit higher than the one they qualify for and the home purchase does not yield a total of more than $8,000 in tax credits. For example, the one of the first time home buyer could claim $6,500 and the first-time home buyer could claim $1,500. Alternatively, both buyers could claim a $4,000 tax credit."

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Are that many people investing in $800,000. properties that the ads boast $8000. credit? This seems very unfair as no mention of 10% is made.

Stape - I think you have miscalculated. 10% of $800,000 is $80,000 - therefore, you would have to purchase an $80,000 home in order to get the full $8,000 (8,000 * .1 = 8,000), which is a pretty common price for a home.

Right you are! Thank you for that - and we have been given the all clear by CPA...all is well.