Tax Credit – Extended & Amended: What does this mean for you?
The first-time home buyer tax credit has been recently redesigned to deliver expanded tax relief! No doubt you may have heard plenty of discussion on this widespread topic of conversation, but what does it all really mean? The following consists of pertinent information on this subject and answers to common questions on the minds of many.
Who qualifies as a “First-Time Home Buyer”? Eligible first-time home buyers are described as anyone who has not owned a primary residence within the last 3 years prior to their purchase.
When is the “deadline”? “Have I missed it?” Don’t worry. You haven’t missed out. The old deadline used to stipulate the transaction to close by Nov. 30. However, under the provisions of the new tax credit law, the deadline has been extended to 2010. On the condition that home buyers have a binding sales contract in effect before April 30 of 2010, the transaction may close anytime up to June 30 of 2010.
How much will I be credited? Do I have to pay this back eventually? The credit is equal to 10 % of the purchase price with a maximum of $8,000. This credit does not have to be paid back as long as this home remains your primary residence and you do not sell this home within three years of your purchase.
Does my income affect my eligibility for this credit? For taxpayers who have purchased between January 1, 2009 through November 6, 2009 income limits are $75,000 for those filing as “single” and $150,000 for married couples filing jointly. For taxpayers who purchase between November 7, 2009 and April 30, 2010 income limits have been raised to $125,000 for “single” and $225,000 for married couples filing “joint” status.
What is all this I hear about a “$6500 Move Up”? SELLERS TAKE NOTE! – The amended tax credit just got sweet for you too! If you’ve owned and lived out of your previous home for at least 5 consecutive years out of the last 8 years, YOU can claim a credit of 10% of the purchase price up to an amount of $6,500 on a home you buy between November 7, 2009 and April 30, 2010. (This applies to purchases of $800,000 or less.)
If you have questions about any of the above or want to take advantage of any of the tax credits, call us today at (502) 371 – 1169.
