BerniNash@Realtor.com

 EXTENSION and EXPANSION of HOMEBUYER TAX CREDIT

The extension of the homebuyer tax credit has been signed into law by President Obama.  Details are also in a table at the end of this information below, or available at this link:  Federal Housing Tax Credit.

WHO IS ELIGIBLE: 

• The up to $8,000 first-time homebuyer tax credit is extended from November 30, 2009 until April 30, 2010. As before, a first-time homebuyer is defined as a buyer who has not owned a principal residence during the three-year period prior to the purchase.
• A very important NEW provision is that the expanded program now offers a credit of up to $6,500 to existing homeowners who have lived in their current home for at least five years and are purchasing a home to be their principal residence.
• All U.S. citizens who file taxes are eligible to participate in the program.

INCOME LIMITS – these have increased from the previous credit!

• Homebuyers who file as single or head-of-household taxpayers can claim the full applicable ($8,000 or $6,500) credit if their modified adjusted gross income is less than $125,000
• For married couples filing a joint return, the combined income limit is $225,000.
• Single or head-of-household taxpayers who earn $125,000 - $145,000, and married couples earning $225,000-$245,000 are eligible to receive a partial credit.
• The credit is not available for single taxpayers whose modified adjusted gross income is greater than $145,000 or to married couples whose modified adjusted gross income exceeds $245,000

ELIGIBILITY DATES:

• The eligibility period for the tax credit is for homes purchased after November 6, 2009, and before May 1, 2010.
• Home purchases subject to a binding sales contract signed by April 30, 2010 will qualify for the tax credit if the closing occurs prior to July 1, 2010.

HOMES THAT QUALIFY:

• All homes with a purchase price of less than $800,000 qualify, including single-family, condominiums, and townhomes, provided the home will be used as the buyer’s principal residence.
• Vacation home and rental property purchases do NOT qualify.

FYI:  TAX CREDIT IS REFUNDABLE

• In other words, if the amount of income taxes you owe is less than the credit amount you qualify for, the government will send you a check for the difference.
• All qualified homebuyers can take the tax credit on their 2009 or 2010 income tax return regardless of which year in which the home is purchased.
• As a true credit, there is no repayment provision unless the homeowner sells or stops using the home as their principal residence within three years after the purchase.

Further information can be found at www.federalhousingtaxcredit.com

The extended and expanded homebuyer tax credit, along with low interest rates and good home prices, make this a perfect time to purchase a home. However, it is important to consult a tax professional in order to obtain specific guidance on tax laws, including those pertaining to the Home Buyer Tax Credits. 

I can provide valuable assistance and advice on many important considerations such as:

• The importance of pre-qualification for a home loan
• Housing features specific to individual or family needs
• Locations, neighborhoods, and schools
• Figuring monthly mortgage payments
• Property taxes
• Home inspections

 OTHER HOME IMPROVEMENT TAX CREDITS:

Email me:  BerniNash@realtor.com     or call:        615-506-0070         and get started today!