Lee County, AL - Tax Credit for Homebuyers Extended

By
Real Estate Agent with First Realty Auburn

On November 9, 2009, the President approved the first-time homebuyer tax credit extension which will extend the tax credit until April 30, 2010. 

Following are the Primary Q&A's regarding the Tax Credit for Homebuyers

First-Time Homebuyers (FTHBs): First-time homebuyers (that is, people who have not owned a home within the last three years) may be eligible for the tax credit. The credit for FTHBs is 10% of the purchase price of the home, with a maximum available credit of $8,000.

Single taxpayers and married couples filing a joint return may qualify for the full tax credit amount.

Current Owners: The tax credit program now gives those who already own a residence some additional reasons to move 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.

Single taxpayers and married couples filing a joint return may qualify for the full tax credit amount.

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 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 was said and done. So, if a first-time homebuyer were to owe $8,000 in income taxes and would qualify for a tax credit of $8,000, she would owe nothing.

Better still, the tax credit is refundable, which means the homebuyer can receive a check for the credit if he or she has little income tax liability. For example, if a first-time homebuyer is eligible for a tax credit of $8,000 but is liable for $4,000 in income tax, she can still receive a check for the remaining $4,000!

Higher Income Caps

The amount of income someone can earn and qualify for the full amount of the credit has been increased.

Single tax filers who earn up to $125,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, single filers who earn $145,000 and above are ineligible

Joint filers who earn up to  $225,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, joint filers who earn $245,000 and above are ineligible.

Maximum Purchase Price

Qualifying buyers may purchase a property with a maximum sale price of $800,000.

Tax Incentives to Spur Energy Savings and Green Jobs

This provision is designed to help promote energy-efficient investments in homes by extending and expanding tax credits through 2010 for purchases such as new furnaces, energy-efficient windows and doors, or insulation.

Landmark Energy Savings

This provision provides $5 Billion for energy efficient improvements for more than one million modest-income homes through weatherization. According to some estimates, this can help modest-income families save an average of $350 a year on heating and air conditioning bills.

 

Active in Alabama, Mara Hawks, REALTOR with FIRST REALTY of Auburn, AL, #1 Real Estate Team in Lee County, THE LEADER in professional real estate services in Auburn, Opelika & Lee County for over 3 decades! Committed to INTEGRITY, KNOWLEDGE & SERVICE.

CLICK ON CART TO SHOP FOR HOMES IN AUBURN-OPELIKA, ALABAMA   

Disclaimer: All information provided by this author is is not guaranteed, may be based on information collected from several sources, which may or may not be deemed reliable at the time of researching this article and may be time sensitive.

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Courtesy of Mara Hawks, inactive REALTOR®, storyteller/writer/editor. 

 Let's talk about LEE COUNTY ALABAMA!  

© 2012 Mara Hawks, All rights reserved

 

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Ambassador
687,290
Ann Allen Hoover
RE/MAX Advantage South - Hoover, AL
CDPE SRES ASP e-PRO Realtor - Homes for Sale - AL

Hi Mara, this is a nice explanation of the tax credit.  How's the weather in Auburn today? HA!  We are getting soaked!

Nov 10, 2009 03:30 AM #1
Rainmaker
2,855,287
Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher

Mara, I think this is wonderful news.  I just purchased a new refriderator and was able to take advantage of the savings from that. 

Nov 10, 2009 05:01 AM #2
Rainmaker
1,077,052
Bill Gassett
RE/MAX Executive Realty - Hopkinton, MA
Metrowest Massachusetts Real Estate

Mara I hope you snag a few of the 1st time buyers or even a nice move up!

Nov 10, 2009 08:29 AM #3
Ambassador
1,890,246
Gary Woltal
Keller Williams Realty - Flower Mound, TX
Assoc. Broker Realtor SFR Dallas Ft. Worth

Hi Mara. Thanks for bringing up the new rules for your local market. Should help many more buyers into the Winter and Spring buying season.

Nov 10, 2009 11:12 AM #4
Rainmaker
1,956,480
Tom Braatz Waukesha County Real Estate 262-377-1459
Coldwell Banker - Oconomowoc, WI
Waukesha County Realtor Real Estate agent. SOLD!

Mara

Great explanation of the new program; I would like to think buyers will really sit up and take notice this time. This is a great program.

Nov 14, 2009 01:30 AM #5
Rainmaker
516,588
Russell Lewis
Realty Austin, Austin Texas Real Estate - Austin, TX
Broker,CLHMS,GRI

Hey Mara, just dropped bu to see how things are going in your neck of the woods! I hope the extension brings you the opportunity to help some buyers!

Nov 15, 2009 12:43 PM #6
Rainmaker
516,588
Russell Lewis
Realty Austin, Austin Texas Real Estate - Austin, TX
Broker,CLHMS,GRI

Hey Mara, just dropped bu to see how things are going in your neck of the woods! I hope the extension brings you the opportunity to help some buyers!

Nov 15, 2009 12:43 PM #7
Ambassador
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Sheldon Neal
Bergen County, NJ - RE/MAX Real Estate Limited - Maywood, NJ
That British Agent Bergen County NJ

Very nicely summarized Mara !!!

All the very best to you with clients taking advantage of the credits :o)

Cheers Mara !

Sheldon :o)

Nov 17, 2009 12:31 PM #8
Rainer
478,183
Not a real person
San Diego, CA

Nice post. I can see people setting closing for June 30, 2010, and having a delay. After all, do closings ever happen on time?

Happy Thanksgiving from our house to yours!

Nov 22, 2009 09:24 PM #9
Rainmaker
1,077,052
Bill Gassett
RE/MAX Executive Realty - Hopkinton, MA
Metrowest Massachusetts Real Estate

Mara just dropping back in to say hello. I hope you are doing well:)

Dec 05, 2009 08:22 AM #10
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Mara Hawks

Inactive-2012 REALTOR - Homes for Sale Auburn Real Estate, AL
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