The Federal Tax Credit WILL BE Extended!
Thursday, November 5th, 2009
The US Senate and the House of Representatives have voted on an extension of the Federal Housing Tax Credit, with a new twist! The passage of H.R. 3548 provides for an extension of the existing first-time home buyers tax credit of $8,000 AND provides a new tax credit for move-up buyers of $6,500! The legislation is expected to be signed by the President on Friday, November 6th!
First time home buyers will be eligible for the Federal Tax Credit if they meet the criteria of the original Tax Credit legislation, namely:
1. An income limitation of $75,000 for a single purchaser or $150,000 for a couple.
2. The Tax Credit is limited to 10% of the purchase price of the home or $8,000, whichever is less.
3. The purchaser must be a first time home owner and the residence must be their principle residence.
For the new Move-up home buyer the criteria is similar:
1. You must have owned your current home for 5 or more years.
2. The income limitations are $125,000 for a single or $250,000 for a couple, but above those limits the $6,500 Tax Credit may be available on a phase out basis.
3. The home must be your principle residence and may be priced up to $800,000.
For both groups, the Tax Credit will be available to those purchasers who sign a contract to purchase by April 30, 2010 and close escrow no later than June 30, 2010. (The credit may be extended for up to 12 months for purchasers who are serving in the military outside the United States for at least 90 days. Further clarification on this provision will be forth coming.)
Senator Johnny Isakson (R-Ga) believes this will be the last Tax Credit extension for home buyers. If you are interested in your first new home or would like to move-up to a new home, now is the time to be buying. The Federal Tax Credit is being given a one time extension … think of it as a great Christmas present!
