First-Time Homebuyer Tax Credit Act of 2025

This bill creates a refundable tax credit to help first-time homebuyers. You could get 10% of your home’s purchase price, up to $15,000. If you file taxes as married filing separately, the cap is $7,500; if two or more unmarried people buy together, they share up to $15,000 total . The credit starts to shrink if your income is above 150% of your area’s median income, and also if the home price is more than 110% of your area’s median purchase price . The dollar caps go up with inflation after 2025. You must be at least 18, but if you’re married, it counts if either spouse is 18 .

You can choose to transfer the credit to your mortgage lender at closing and get the same amount in cash (like for a down payment). The lender must register, tell you the credit amount, and pay you at purchase; the payment isn’t taxable to you. The IRS can advance funds to lenders, and it can revoke a lender’s registration if rules aren’t followed. You have to make this election by the purchase date . If you sell the home or move out within 4 years, you may have to repay part of the credit, with exceptions for things like death, certain military or government moves, disasters, divorce transfers, or qualifying job-related moves; any payback is capped by your gain on the sale . The IRS can treat clear errors (like age or missing forms) as simple math mistakes and fix them quickly . These changes apply to homes bought after the law is enacted. You can also choose to count a purchase made after December 31, 2023, as if it happened on December 31 of the prior year for tax filing purposes .

Key points

• Who is helped: First-time homebuyers of a main home in the U.S., age 18+ (or married to someone 18+) .
• What you get: Refundable credit up to $15,000 (10% of price), with income and home-price based phase-downs; inflation-adjusted after 2025 .
• How you can use it: Claim on your taxes, or transfer to your lender at closing to get cash upfront; not taxable to you .
• Important limits: No credit if you sell or stop using it as your main home before year-end; must attach the closing statement with your tax return; possible payback if you move or sell within 4 years (with several exceptions) .
• When it starts: Applies to homes bought after enactment; optional “prior year” election for purchases after Dec. 31, 2023 .