What is the deal with $8,000 Tax Credit for First-Time Homebuyers?
The big financial news this week is that the Tax Credit for First-Time Homebuyers that was set to expire on November 30, 2009 has been extended until April 30, 2010. It also has been expanded to include a$6,500 tax credit for current home owners who buy a new house. President Obama is expected to sign the bill this morning.
Do you plan on buying a house?
Eligibility for the First-Time Homebuyer Credit
There are some requirements you have to meet before you can get the First-Time Homebuyers credit.
- You must be a first-time home buyer and you must have a purchase contract by April 30, 2010 and closes by .
- The house you purchase must be your primary residence and is not greater than $800,000.
- The buyer must live in the home for at least three years after the purchase date. You will have to repay the credit on a home only if the home ceases to be your primary residence within 3 years from the date of purchase. The full amount of the credit received becomes due on the return for the year the home ceased being your principal residence.
- The income limits have been raised for singles to $125,000 and married to $225,000.
Eligibility for the Existing Homebuyer Credit
- You must have lived in your current residence for 5 of the last 8 years.
- The house you purchase must be your primary residence and is not greater than $800,000.
- The buyer must live in the home for at least three years after the purchase date. You will have to repay the credit on a home only if the home ceases to be your primary residence within 3 years from the date of purchase. The full amount of the credit received becomes due on the return for the year the home ceased being your principal residence.
- The income limits have been raised for singles to $125,000 and married to $225,000.
Please check out the NY Times for more details and other provisions in the bill. If you need anymore pointers, do not hesitate to use an online software like Turbo Tax online, which has a wealth of advice on tax filing and credits available.
Your Thoughts
Will you buy a house within the tax credit’s extension? How much did the tax credit factor into your plans?
Photo Credit: roarofthefour
