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First-time buyer tax credit a hit

Program on track to exceed 2 million target

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Preliminary numbers from the Internal Revenue Service suggest 1.4 million taxpayers will claim the federal first-time homebuyer tax credit on their 2008 tax returns, meaning the program is likely to meet or exceed the 2 million target set by lawmakers before it sunsets Nov. 30, 2009. A report by the Treasury Inspector General for Tax Administration, which looks at 56.9 million tax returns received through March 6, revealed that 567,685 households claimed the tax credit, but 38,158 weren't eligible because they may have been homeowners in the last three years. If those trends hold up for all 140 million tax returns the IRS expects this year, about 1.4 million households will claim the first-time homebuyer tax credit, but about 94,000 of those will be disqualified because they are not first-time homebuyers. A first-time homebuyer is defined as anyone who hasn't had an ownership interest in a principal residence for three years, and income limits also apply. IRS Form 5405 wil...