The U.S. Military, Armed Service, Intelligence Service and Foreign Service personnel bonus extending the home buyers' tax credit is in effect for less than two months. Don't miss out on this great opportunity to pay it forward to our service men and woman and help them take advantage of this well deserved bonus.
The bonus is designed to benefit U.S. Military personnel on active duty and out of the U.S. for 90 days of qualified, extended duty service outside of the United States between January 1, 2009 and April 30, 2010. The enchantment provides our Military personnel additional time to buy their homes - the deadline is May 1, 2011. Keep in mind that Spouses of Military Personnel qualify as well.
The bonus provides another huge benefit, which is a waiver on the time of occupancy. Most homebuyers using the tax credit must use the home purchased as a principal residence for a period of at least three years or forfeit the entire credit. U. S. Military, Intelligence and Foreign Service Personnel will not be required to repay the credit should they find themselves selling their home as the result of new orders that require the relocation as the result of official military business.
Below is information that has been previously posted:
The federal home buyer tax credit ranges up to $8,000 for first-time home buyers, and up to $6,500 for existing homeowners. Existing homeowners must have lived in their "main home" through 5 of the last 8 years to be eligible.
Important date to keep in mind" Eligible persons must be under contract for a new home on or before April 30, 2011. The home's closing must then occur on or before June 30, 2011.
The IRS does not make date exceptions. Furthermore, both the buyer(s) and the subject property must meet certain minimum eligibility requirements:
- The home may not be purchased from a parent, spouse, or child
- The home may not be purchased from an entity in which the seller is a majority owner
- The home may not be acquired by gift or inheritance
- Each buyer must meet tax credit eligibility standards
- The home sale price may not exceed $800,000
- Buyers may not earn more than $125,000 as single-filers; $225,000 as joint-filers
The complete program description is published on the IRS website. Click Here to access - http://www.irs.gov/newsroom/article/0,,id=215594,00.html
Another important note is that the IRS is giving eligible buyers a tax credit as opposed to a deduction. This means that a taxpayer qualifying for the full $8,000, and for whom the "normal" 2011 federal tax liability is $8,000, will have zero federal tax liability in 2011.
If you have questions regarding the tax credit eligibility, it is always best to consult a tax professional. Also, be sure that you and your client are working with a local VA loan professional. If you need assistance with this special program, or VA financing in general, feel free to contact our offices. We are here to help.
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