Although the American Recovery & Reinvestment Act is frequently characterized as a tax credit for new home buyers, move-up and down-sizing homeowners could benefit as well!
In the Pinehurst and Southern Pines, North Carolina areas, down-sizing homebuyers are common as retirees often move from a larger home to one that is smaller and often less expensive also many investors are taking advantage of market conditions to invest in a second home.
We suggest you consult with your tax planning professional for the particulars and in the interim are providing an overview of the government's requirements for your consideration.
Applicable timing issues include...
The previous home must have been occupied as the buyer's principal residence for at least five consecutive years out of the past eight years.
The new home must be used as a principal residence for three years after closing, or else the credit must be repaid.
You must have closed on the purchase of the new home sometime after 11/6/2009 and before 4/30/2010 with one exception: the new home will qualify if you entered into a purchase contract by no later than April 30, 2010 and closed the transaction by June 30, 2010 at the latest.
The timing for the sale of the original home is of no importance and in fact may not even be sold. One may consider keeping the property as a second home or use it as a rental property.
Other considerations include...
The cost of the new home may not exceed $800,000 and the actual tax credit is for 10% of the purchase price up to a maximum credit of $6,500 for joint filers and $3,250 for those filing separately.
Singles whose income does not exceed $125,000 and for couples whose income is no more than $225,000 would be eligible for full credit and there is a phase-out applicable to those with incomes up to $145,000 and $245,000 respectively.
While this program may not benefit everyone, clearly it can be a real bonus for those in position to take advantage it.
Please contact us for more information about investing in Pinehurst NC Real Estate whether as a Second Home, base for an active retirement , for down-sizing and moving-up, we would love to help you find your way home.
Thank you for your interest and the privilege of serving you!
With our highest regard,
Wayne and Lynda Gomillion
Trusted Names in Real Estate
"The friendship and referrals of those we serve is the foundation of our success."
Member of the Real Estate Intelligence Network
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