The provisions of the latest homebuyer tax credit applies to any purchases made now through April 30, 2010. This means that any first-time buyer who couldn’t close before December 1, 2009 (the original expiration date) now need not worry about losing out on the credit. It also means that the newly qualifying repeat buyers will receive the credit on any qualified closing starting today.
Some key provisions of the new tax credit include:
- An extension of the credit to cover any purchase of a principal residence by qualifying buyers who are under contract by April 30, 2010 and close by June 30, 2010.
- An expansion of coverage in two ways:
1. Broadens those eligible to more than first-time buyers.
2. Raises the income limits.
- “LONG-TIME RESIDENTS OF SAME PRINCIPAL RESIDENCE” now qualify. These are buyers who have “owned and used the same residence as such individual's principal residence for any 5-consecutive-year period during the 8-year period ending on the date of the purchase of a subsequent principal residence.” Quoting from H.R. 3548 as passed by the House and Senate.
- The credit amount for these buyers is 10% of the purchase price to a maximum of $6,500. Any qualifying buyer purchasing a home costing more than $65,000 will receive the full amount (See the purchase price limitation below).
- The credit still applies to first-time buyers (which includes anyone who has not owned a home for the past three years). The credit amount for these buyers remains at 10% of the purchase price to a maximum of $8,000. Any qualifying buyer purchasing a home costing more than $80,000 will receive the full amount (See the purchase price limitation below).
If you are planning to take advantage of the tax credit, be sure to check with your accountant or tax attorney for all of the details. The IRS website will also have some additional information on the new provisions. Visit http://www.irs.gov/ to learn more.
To take advantage of this opportunity, contact one of our professionals today.
Learn more about the market and about the tax credit at our Blog.