It's Official! - Tax Credit Extended!

It's Official --- President Obama signed the Homebuyers Tax Credit extension and expansion

Two Ways to Qualify for the Tax Credit

First-Time Homebuyers: First-time homebuyers (a person who has not owned a home for the last 3 years) may be eligible for the tax credit. The credit for first time home buyers is 10% of the purchase price of the home, with a maximum available credit of $8,000. Single taxpayers and married couples filing a joint return may qualify for the full tax credit amount.

Current Owners: The tax credit program now gives those who already own a residence some additional reasons to move to a new home. This incentive comes in the form of a tax credit of up to $6,500 for qualified purchasers who have owned and occupied a primary residence for a period of five years during the last eight years. Again, single taxpayers and married couples filing a joint return may qualify for the full tax credit amount.

What are the New Deadlines?

In order to qualify for the credit, all contracts need to be in effect no later than April 30, 2010 and close no later than June 30, 2010.

Higher Income Caps

The amount of income someone can earn and qualify for the full amount of the credit has been increased. Single tax filers who earn up to $125,000 are eligible for the total credit amount. The previous tax credit limited this income to $75,000. Those who earn more than this cap can receive a partial credit. Joint filers who earn up to $225,000 are eligible for the total credit amount. Previously the income limit for married couples was $150,000. Those who earn more than this cap can receive a partial credit.

Maximum Purchase Price

Qualifying buyers may purchase a property with a maximum sale price of $800,000. The previous tax credit had no limit on the purchase price of a home.

The National Association of Realtors provides some excellent information to questions you may have:

• Compare the differences between the current tax credit and extended and expanded version. (PDF: 30KB)
  

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