12 November 2009
Homebuyer’s Tax Credit Extended and Expanded
The First-Time Homebuyer Tax Credit has been extended through April 30, 2010 and now includes a new $6,500 credit for homebuyers who have been in their current residence for the last five years or more. Income limits were also increased to allow more individuals and couples to qualify for the assistance.
“This is great news for consumers, but there will be competition among the properties that are priced right, located in desirable areas and are in good condition,” says Virginia Cook, CEO of Virginia Cook, Realtors. “The demand will also contribute to the price increases we are already seeing. If you are serious about taking advantage of this tax credit, now is the time to start shopping!”
Economists with the National Association of Realtors estimate that the current tax credit has contributed approximately $22 billion to the general economy, and approximately 2 million people will take advantage of the tax credit this year. Each home sale generates approximately $63,000 in additional economic activity.
Tax Credit Details:
-First-time homebuyers who are eligible can obtain a tax credit of $8,000.
-Current homeowners are eligible for a $6,500 tax credit, provided that they have lived in the home they are selling, or have sold, as a principal residence for five consecutive years in the past eight years.
-Income limits for eligible home buyers are increased to a $125,000 to $145,000 range for single buyers and a $225,000 to $245,000 range for couples.
-The maximum purchase price of the home has been increased to $800,000.
-If potential home buyers have a binding contract on or before April 30, 2010, they will have until July 1, 2010 to close the transaction.
-To help guard against fraud, buyers are required to attach documentation of purchase to their tax return.
Added Benefits for Those Serving Our Country:
-Armed services members and intelligence service and foreign service personnel who are on active duty and out of the U.S. for 90 days during any part of 2009 will receive an additional year to buy their homes. Their deadline is May 1, 2011.
-Homebuyers who purchase their home using the tax credit must use that home as a principal residence for a period of no fewer than three years, or they must forfeit the entire credit. However, military, intelligence and foreign service 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.
For more information, contact Virginia Cook, Realtors.
Additional Resources:
2009 First-time Home Buyer Credit - Basic Details
National Association of Realtors
2009-2010 Extended and Expanded Tax Credits for Homebuyers
IRS.gov
Economists with the National Association of Realtors estimate that the current tax credit has contributed approximately $22 billion to the general economy, and approximately 2 million people will take advantage of the tax credit this year. Each home sale generates approximately $63,000 in additional economic activity.
Tax Credit Details:
-First-time homebuyers who are eligible can obtain a tax credit of $8,000.
-Current homeowners are eligible for a $6,500 tax credit, provided that they have lived in the home they are selling, or have sold, as a principal residence for five consecutive years in the past eight years.
-Income limits for eligible home buyers are increased to a $125,000 to $145,000 range for single buyers and a $225,000 to $245,000 range for couples.
-The maximum purchase price of the home has been increased to $800,000.
-If potential home buyers have a binding contract on or before April 30, 2010, they will have until July 1, 2010 to close the transaction.
-To help guard against fraud, buyers are required to attach documentation of purchase to their tax return.
Added Benefits for Those Serving Our Country:
-Armed services members and intelligence service and foreign service personnel who are on active duty and out of the U.S. for 90 days during any part of 2009 will receive an additional year to buy their homes. Their deadline is May 1, 2011.
-Homebuyers who purchase their home using the tax credit must use that home as a principal residence for a period of no fewer than three years, or they must forfeit the entire credit. However, military, intelligence and foreign service 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.
For more information, contact Virginia Cook, Realtors.
Additional Resources:
2009 First-time Home Buyer Credit - Basic Details
National Association of Realtors
2009-2010 Extended and Expanded Tax Credits for Homebuyers
IRS.gov
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