$8,000 First Time Homebuyer Tax Credit - Current Homeowners May Qualify for $6500
The enactment of the Worker, Homeownership and Business Assistance Act of 2009 has extended and expanded the $8,000 first time homebuyer tax credit and includes a provision in which current homeowners may qualify for $6,500.
Who qualifys for the extended tax credit?
First-time home buyers** who purchase homes between November 7, 2009 and April 30, 2010 and it closes before July 1, 2010.
Current homeowners purchasing a home between November 7, 2009 and April 30, 2010 who have lived in their current home consecutively for 5 of the previous 8 years.
**You are considerred a first-time home buyer if the purchaser or his/her spouse did not own a residence during the three year period prior to the purchase.
How much is available?
A refundable credit equal to the lesser of 10% of the purchase price** or $8,000 for first time homebuyers.
A refundable credit equal to the lesser of 10% of the purchase price** or $6,500 for current homeowners.
**The purchase price under the Extended Home Buyer Tax Credit must not exceed $800,000.
What are the income limits?
For homes purchased on or after November 7, 2009 single buyers with incomes up to $125,000 and married couples with incomes up to $225,000 qualify for the full amount of the tax credit.
The credit phases out for buyers who earn between $125,000 and $145,000 for single buyers and between $225,000 and $245,000 for home buyers who file jointly. The amount of the tax credit phases out as his/her income approaches the maximum limit. Home buyers who earn more than the maximum qualifying income—over $145,000 for singles and over $245,000 for couples are not eligible for the credit.
What types of properties are eligible?
The Extended Home Buyer Tax Credit may be applied to primary residences including: single-family homes, townhomes, condos and co-ops.
Does the tax credit need to be repaid?
No. The tax credit does not need to be repaid if the buyer occupies the home for three years or more. However, if the property is sold within 3 years of purchase, you will be required to repay the credit.
Added Benefits for Members of the Military
Members of the Armed services and certain federal employees who are on active duty and serving outside the United States get an extra year to buy a principal residence and still qualify for the tax credit. They must buy or enter into a binding contract to purchase a home by April 30, 2010 and close by June 30, 2011.
There is also a waiver on the time of occupancy of the home purchased with the tax credit. Military personnel do not have to repay the credit if they have to sell their home after fewer than three years occupancy due to official business.
Learn more about the $8,000 & $6,500 tax credits.
If you have specific questions or need additional information, please contact a tax professional or the Internal Revenue Service at 800-829-1040.
| Feature |
Jan. 1 - Nov. 30, 2009 |
Nov. 7 - Apr. 30, 2010 |
|
First-time Buyer- |
$8,000 ($4,000 married |
$8,000 ($4,000 married |
|
First-time Buyer- |
May not have had an |
Same |
|
Current Homeowner- |
No Provision |
$6,500 ($3.200 married |
|
Effective Date- |
No Provision | November 7, 2009 |
|
Current Homeowner- |
No Provision |
Must have used the |
| Termination of Credit |
Purchases after |
Purchases after April 30, 2010 |
| Binding Contract Rule | None |
So long as a written |
|
Income Limits |
$75,000 - single |
$125,000 - single |
|
Limitation on Cost of |
None | $800,000 November 7, 2009 |
|
Purchased by a |
No Provision | Ineligible November 7, 2009 |
| Anti-fraud rule | None | Purchase must attach documentation of purchase to tax return |
**********************************************************************************************
Written and Posted by: Donna Bigda - REALTOR® RE/MAX Alliance - Branford, CT 06405 Search Branford, East Haven, Guilford, Madison, New Haven and all New Haven County Homes for Sale
