Homebuyer Tax Credit Extended

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The Worker, Homeownership and Business Assistance Act of 2009. Its true the home buyer tax credit for first time buyers has been extended, revised and expanded to include even more opportunities for people to take advantage of the Homebuyer tax credit! There is a lot of information available on any number of websites and or blogs about the Homebuyer Tax Credit, some are good and some are questionable. This post is based on information obtained from the National Association of Realtors website and the IRS website, 2 sources that I believe to be credible in providing this kind of information, their information is provided at the end of this post.

I’m sure most people are familiar with the Homebuyer Tax Credit of up to $8,000.00 that has been available from the summer of 2009 through November 30, 2009. just in case you did miss it let me summarize that program. A tax credit of up to $8,000.00 was available for first time home buyers if their income levels qualified and the price of the home was within certain limits, the amount of the credit was determined by these factors and marital status and the need to close on the sale on or before November 30, 2009. The credit is received as either a payment of taxes owed on the return or will pay the taxes due and refunded the difference, or will be added to the refund on returns.

 Here are some of the features of the new, revised  Extended Homebuyer Tax Credit:

• The credit can be taken on the 2009 or 2010 tax return and does not have to be paid back
• The accepted contract must be attached to the Tax return the buyer will be taking the credit on.
• To qualify the contract must be written and accepted on or before April 30, 2010 and the sale must be closed by June 30, 2010
• The new law gives the IRS broader flexibility  deny requests for first time buyer credits. ( This is most likey in response to a large number of requests for the Homebuyer Tax Credit  under the previous offerign that have turned out to be fraudulent.) That said be sure to discuss your ability to qualify with your Accountant and your Realtor.
•  Military persons serving outside the US have an additional year to use the credit
• Income limitiations are $125,000- $145,000 for individuals and $225,000.00- $245,000.00 for joint filers 

As an added opportunity to take advantage of the Homebuyer Tax Credit, the new bill is expanded to include people who who have lived in a home as their principal residence for 5 consecutive years of the past eight years and those who qualify will receive up to a $6,500.00 tax credit. if you read that sentence carefully it says 5 consecutive years of the last eight, not the last 5 consecutive years, which seems to mean if you don’t currently own a home but have lived in one for 5 consecutive years of the last 8 you may qualify!! An example might be someone who got divorced say 2 years ago and had lived in a residence for 5 consecutive years of the past eight, might qualify. Purchase price of the home cannot exceed $800,000.00.

Be sure to have all of your questions answered by talking with a Realtor and Accountant to take advantage of the Homebuyer Tax Credit.

For more  information about the Homebuyer Tax Credit go to the IRS Website at http://www.irs.gov/newsroom/article/0,,id=204671,00.html  or www.Realtor.com .