The Latest News About Home Buyer Tax Credits
Posted on November 18, 2009
Filed Under Tax Credits | Leave a Comment
There is great news for people looking into buying a home! Congress has recently passed new legislation, as a part of the strategy for stimulating the U.S. housing market, that makes the Federal tax credit of up to $8,000 now available to even more first-time home buyers. In addition, some people who now own a home and would like to buy a new one may also be eligible for a Federal tax credit totaling up to $6,500.
The Extended Home Buyer Tax Credit extends and enhances the current program which runs out on November 30th. Both first-time and move-up buyers can now get the advantages of the Federal tax credit. Needless to say, this is over and above today’s historically low home loan interest rates.
Outlining the new legislation’s particulars::
* The first-time buyers’ $8,000 has now been extended through April 30th, 2010. * Current homeowners are now eligible for a $6,500 tax credit, provided they have resided in the home they are selling as their principal home for a minimum of five consecutive years within the past eight years. * The income limits for eligible buyers were increased to a range of $75,000 to $125,000 (for single buyers) and a range of $150,000 to $225,000 for couples. * Time has been added to make allowance for closing the home purchase transaction. If they have a legal contract by April 30, they will then have until June 30, 2010, to close the purchase. * In order to qualify, the purchase price of the residence must be no more than $800,000.
The program works as follows:
* Tax credits provide a dollar-for-dollar payment of taxes owed with any surplus funds available as a refund. The amount of the credit will be first credited toward any tax liability for the year of purchase. Next the remainder will be paid to the buyer. (For example a first-time buyer whose tax liability is $2000 would receive a payment of $6,000). * Any single-family home purchased to be used as a primary residence (including condominiums, co-ops) will qualify assuming that it is purchased by April 30, 2010 and closed by the end of June, 2010. * The full amount of the may be claimed by individuals with an adjusted gross income of no more than $125,000 or $225,000 on a joint return. Above those incomes, the amount of the tax credit drops until the maximum limit is reached – $145,000 for individuals or $245,000 of joint income.
Jim Navary has been a freelance writer and researcher for over thirty years covering a wide range of topics. He is also a licensed real estate salesperson in the Commonwealth of Virginia specializing in real estate in the Tri-Cities area of Virginia and, in particular, Fort Lee, Virginia, area houses for sale.
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