First-Time Homebuyer Tax Credit Program

The Delaware State Housing Authority introduced a tax credit program for first-time homebuyers to incentivize and help them afford the purchase of their first home.

Available Assistance
The State of Delaware has a special tax credit for first-time homebuyers that can help make homebuying more affordable. Residents can claim part of the annual interest paid on their mortgage (35% of the interest) as a special federal tax credit of up to $2,000 a year. The tax credit can be used along with down payment and closing cost assistance programs through participating lenders.

Eligibility Requirements
To qualify for this tax credit, individuals must purchase a home within the State of Delaware. They must be first-time homebuyers—those who have not owned a home in the past three years, unless they are purchasing a home in a Targeted Area or the homebuyer is utilizing the Qualified Veteran Exemption. The program mandates that the household income and the purchase price not exceed the maximum limits (shown below).

Income Limits
New Castle County Non-Targeted areas
1 or 2-person household: $90,100
3 or more person household: $103,615

New Castle County Targeted Areas
1 or 2-person household: $108,120
3 or more person household: $126,140

Kent and Sussex Counties Non-Targeted Areas
1 or 2-person household: $78,900
3 or more person household: $90,735

Kent and Sussex Counties Targeted Areas
1 or 2-person household: $94,680
3 or more person household: $110,460
 
Note: All information mentioned above was accurate at the time of publication and may no longer be current - visit the program website for updated information.