CHICAGO HOMEBUYER TAX CREDIT UPDATE! 

On November 6, 2009, President Obama signed a Bill to extend the tax credit for first-time homebuyers through June 30, 2010.  The Bill also opens up opportunities for others who are not buying a home for the first time.

TWO TAX CREDITS

First Time Homebuyer:  To qualify, you canot own a home within the last three years to be eligible for the this tax credit.  The tax credit is 10% of the purchase price wiht a maximum available credit of $8,000.  Single taxpayers and married couples filing a joint return may qualify for hte full tax credit amount.  (See your accountant as well as your lender for what you would qualify for)

CURRENT OWNERS:  The Tax Credit Program now gives those who already own a residence, some additional reasons to move on up to a new home.  This incentive comes in the form of a "tax credit" of up to $6,500 for qualified purchasers who have owned and occupied a primary residence for a period of five consecutive years during the last eight years.

WHAT ARE THE NEW DEADLINES?

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

TAX CREDIT VERSUS TAX DEDUCTION

It's important to remember that the tax credit is just that .... A TAX CREDIT!  The benefit of a tax credit for the homebuyer, is that it's a dollar-for-dollar tax reduction, rather than a reduction in a tax liability that would only save you $1,000 to $1,500 when all is said and done. 

So, if a first time homebuyer were to owe, let's say $8,000 in income taxes, they would qualify for a tax credit of $8,000 , and would owe nothing.

The Tax Credit is REFUNDABLE.  If you have little or no income tax liability, and you are eligible for a tax credit as a first time homebuyer for $8,000 and you have an income tax liability of $4,000, you can still receive a refund check for the remaining $4,000.   (Again, please consult your tax attorney or accountant as well as your lending institution for the figures you would qualify for)

INCOME CAPS INCREASE TO HELP QUALIFY FOR THE TAX CREDIT

UPDATE:  Single Taxpayers who earn up to $125,000 are eligible for the total tax credit amount.  After $125,000, there is a partial credit with an INCOME CAP in the amount of $145,000 before the single taxpayer is disqualified from the Homebuyer Tax Credit.  

Joint Filiers who earn up to $225,000 are eligible for the total tax credit amount. Again, after $225,000 there is a partial credit with an INCOME CAP in the amounht of $245,000 before you become disqualified for the Homebuyer Tax Credit.

Isn't time you took advantage of an opportunity?  Pick up the phone today and let me give you more specifics about how Home Affordability is still a good investment in your life and for your future.