Buy A Home Before You File Your Taxes And Get The Government Tax Refund In Early 2010.

By Troy Corman, todayshomedeals.com

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Home buyers that buy soon can get their government tax refund shortly after completing and filing their 2009 taxes. Since many file and pay their taxes well before the April 15 deadline, some home buyers that buy an inexpensive, starter home with a FHA loan could literally end up buying a home with no money out of their pocket - after being reimbursed with the government home buyer tax refund.

And if that's not enough, listed below are additional reasons to buy sooner, rather than later, as FHA loans and most mortgages are predicted to get more expensive in 2010.

1. Financial types expect rising interest rates in 2010.

2. Buy before you file your 2009 taxes and get the government refund in early 2010.

3. FHA loans are going to get more expensive for borrowers as Congress has indicated it's approval of higher borrower insurance costs, cutting the amount sellers can pay for buyers' closing costs from 6% to 3%, and possible higher down payments (beyond the standard 3.5%) based on borrowers' credit scores.

4. Lastly, I would expect more buyer competition and less dilly-dallying as we get closer to the April 30 government home buyer tax refund deadline (executed contract deadline date - must close by June 30, 2010). Buyers and agents will most likely not sit around and mull decisions as attractive homes will get gobbled up and put under contract quickly.

If you plan on buying a home in late 2009 or early 2010 before the feeding frenzy begins, you will need: The standard Form 1040 and Form 5405 for the home buyer tax credit.

1. First begin Form 1040.

2. Be sure to take note of your adjusted gross income, which you enter on lines 37 of the form. Form 5405 actually requires you to note your modified adjusted gross income, but that affects few people, so most will just use their adjusted gross income.

3. When you come to Line 69 you'll be asked to enter your tax credit amount. To do that, you'll need to first complete Form 5405.

4. Once you complete Form 5405, enter the amount on Line 69, then complete your return.

5. Attach Form 5405 to your return.

Any refund for which you qualify will be sent to you.