Wisdom & Wit

New Tax Credit Guide

Pam Winterbauer ~ 2006 REALTOR® of the Year (Windermere Welcome Home) — Tue, 01 Dec 2009 16:55:57 -0600

Good From Nov. 6, 2009 to April 30, 2010

Who is Eligible and for What:

First-Time Homebuyer (defined as a non-homeowner for the last three years)
A first-time homebuyer can obtain a tax credit of up to $8,000 of 10% of the purchase price of a home, whichever is less, depending on their income. For example, a $75,000 sales price would have a maximum credit of $7,500.

A) Single taxpayer: The income limit is $125,000. A partial tax credit can be given up to a maximum income of $145,000.

B) Joint filers: The income limit is $225,000. A partial tax credit can be given up to a maximum income of $245,000.

· If either spouse has owned a home in the last 36 months, neither qualify for the tax credit.

· A child (18 years or older) buying with a parent as a co-mortgagor is eligible as long as they meet the other requirements.

Current Owners

Current homeowners can obtain a tax credit of up to $6,500 if they have owned and occupied a primary residence for a period of five (5) consecutive years during the last eight (8) years. Income limits are the same as for first-time homebuyers.

Maximum Purchase Price
The maximum sales price of the property being purchased is $800,000.

New Deadlines

· In order to qualify for the credit, all contracts need to be in effect no later than April 30, 2010 and must close no later than June 30, 2010.

· Members of the armed forces stationed outside the U.S. on official duty for 90 days from January 1, 2009 to April 30, 2010 can sign contracts before April 30, 2011 and close before June 30, 2011.

More Eligibility Restrictions

No tax credit will be given to borrowers who:

· Are buying their home from a blood relative (a step-relative is OK);

· Are not using the home as a primary residence;

· Are selling the home before the end of the year;

· Are non-resident aliens;

· Are getting home financing from tax-exempt mortgage revenue bonds (does not apply for a home purchased in 2009).

Remember .... "Dream Green"

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