Tax Credit for Homebuyers
First-Time Homebuyers (FTHBs): First-time homebuyers (that is, people who have not owned a home within the last three years) may be eligible for the tax credit. The credit for FTHBs 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 consecutive years during the last eight years.
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.
Tax Credit Versus Tax Deduction
It's important to remember that the tax credit is just that... a tax credit. The benefit of a tax credit is that it's a dollar-for-dollar tax reduction, rather than a reduction in a tax liability that would only save you $1,000 to $1,500 when all was said and done. So, if a first-time homebuyer were to owe $8,000 in income taxes and would qualify for a tax credit of $8,000, she would owe nothing.
Better still, the tax credit is refundable, which means the homebuyer can receive a check for the credit if he or she has little income tax liability. For example, if a first-time homebuyer is eligible for a tax credit of $8,000 but is liable for $4,000 in income tax, she can still receive a check for the remaining $4,000!
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. Those who earn more than this cap can receive a partial credit. However, single filers who earn $145,000 and above are ineligible
Joint filers who earn up to $225,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, joint filers who earn $245,000 and above are ineligible.
Maximum Purchase Price
Qualifying buyers may purchase a property with a maximum sale price of $800,000.
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Remember, the new tax credit program includes a number of details and qualifications. For more information or answers to specific questions, please call or email me today.
In addition, you may be able to benefit from additional housing related provisions, including the following:
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Tax Incentives to Spur Energy Savings and Green Jobs
This provision is designed to help promote energy-efficient investments in homes by extending and expanding tax credits through 2010 for purchases such as new furnaces, energy-efficient windows and doors, or insulation.
Landmark Energy Savings
This provision provides $5 Billion for energy efficient improvements for more than one million modest-income homes through weatherization. According to some estimates, this can help modest-income families save an average of $350 a year on heating and air conditioning bills.
Repairing Public Housing and Making Key Energy Efficiency Retrofits To HUD-Assisted Housing
This provision provides a total of $6.3 Billion for increasing energy efficiency in federally supported housing programs. Specifically, it establishes a new program to upgrade HUD-sponsored low-income housing (for elderly, disabled, and Section 8) to increase energy efficiency, including new insulation, windows, and frames.
Expanding Housing Assistance
This provision increases support for several critical housing programs. It includes $2 Billion for the Neighborhood Stabilization Program to help communities purchase and rehabilitate foreclosed, vacant properties.
Courtesy of Vaughn Kavlie - AdvisorNet Mortgage Minneapolis, MN
Currently in the City of Minneapolis you can receive up to 20% of the interest you pay on your mortgage EVERY YEAR as a tax credit... That could mean a direct credit (cash) to you for up to about $3000 a year!!!
The criteria are simple, here are a few of the "important ones":
1- Income guidelines under $92,290 year (AGI) for two people
2- Taking an "all day" homeowner course
3- Buying a Home with a Fixed Rate Mortgage from a participating lender.
4- Buying a home in the City of Minneapolis (Or St. Paul) with a Purchase Price of $276,870 or less.
Feel free to contact me if you have any other questions, but I have already had buyers take advantage of this program, and :in effect" their payment is about $180 less (cash) every month because of it!
Blessed to Serve,
Stieg Strand (612) 643-4103
Broker/Agent/Agency ~ Fair Housing Instructor
Keep in mind, this blog entry is a bit of a "vent" - However it is still very true at the same time....It just came to my attention a few moments ago, after dealing with a regional manager for a Sprint reseller/provider in the north metro of the Twin Cities that they can charge you fee's for anything they want, even if other Sprint Stores do not! - My daughters phone was broken, Sprint would not fix it even though I have been paying nearly $50 a year in insurance to "cover each" phone. So I purchased a phone for her online, and then this "reseller" has the nerve to charge $10 for a 90 second procedure (transferring contacts).
My point is simple - Make sure you call around when you have ANYTHING done on your cell phones, as each store (even with the same name!) May be charging you MORE than the same store a few miles away!
Stieg Strand
Wonderful remodeled top to bottom on awesome quiet lot! Bonus 4th bedroom now being used as a recording studio! Completely clean and ready for your move now. Next door to beautiful City Park!
13504 Pleasant Lane in Burnsville! Come Quickly!!!!
The U.S. Senate just announced that they are seriously considering extending some form of the tax credit for homebuyers, and potentially not just first time homebuyers.
They are looking at a phased out approach or possibly a full blown extension of the current program with greater income allowances and even homebuyers that are not first timers...
Please contact your Senator today and let them know that you want to see some form of assistance in the housing market continue, as the momentum for action is starting now!
I am not a big fan of large government programs inducing the economy, however let's look at the facts, when people become homeowners, when people move to bigger homes when the prices are low, and when GOOD consumers buy and sell homes, it is good for the economy - Let's put it this way - Which has greater lasting impact on our economy? - People having more reason to buy a home that they need (and can afford) or getting financial assistance to buy a new car!!! Seems like money well spent, in comparison to me....
Your thought?
Stieg Strand
A breath of fresh air in a stuffy business. I mean with a name like Stieg...
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