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What is the Recapture Tax?

April 26, 2017recapture tax

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What is the Recapture Tax?

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Homes funded by one of our special First-time homebuyer programs (30-year Fixed Rate Mortgage, FHA Plus) may be subject to a Federal Recapture Tax. This tax only affects buyers who have had rapid and significant increases in income and who sell or transfer their home within nine years of the purchase date. Click here for an Online Recapture Calculator. It is suggested potential buyers contact a tax advisor or the IRS for more information concerning the possibility of the payment of a Recapture Tax. Click here for an IRS explanation of the recapture of federal subsidy.