As we close in on the Federal Tax Credit of $8,000 we have light at the end of the tunnel again with the State allocated 100,000,000 There is a possibility of being eligible for both programs the amount of $18,000. However there is a tight timeline on receiving both simultaneously.
The California State grant has allocated 100,000,000 towards new home buyers and 100,000,000 towards first time home buyers. These tax credits are limited to the lesser of 5 percent of the purchase price not to exceed $10,000. Taxpayers who purchase a qualified principal resident on or after May 1, 2010, and before January 1, 2011 For taxpayers who purchased a qualified principal residence on or after March 1, 2009, and before March 1, 2010. The credit will be applied in equal amounts over the three successive taxable years beginning with the taxable year in which the purchase of the qualified principal residence is made (maximum of $3,333 per year).
Now if you are in contract to purchase by April 30th and close by June 30th, you could be eligible for the federal tax credit. Now, taxpayers who have a binding contract to purchase a home before May 1, 2010, are eligible for the credit. Buyers must close on the home before July 1, 2010. To take advantage of the $8000 credit:
The Taxpayers credit applies to: Only to homes used as a taxpayer's principal residence. Reduces a taxpayer's tax bill or increases his or her refund, dollar for dollar. Is fully refundable, meaning the credit will be paid out to eligible taxpayers, even if they owe no tax or the credit is more than the tax owed. (For more information go to irs.gov/newsroom/article/0,,id=204671,00)
If you are a first time home buyer and in contract to buy a home by April 30th and close by June 30th you are eligible for the 8,000 credit, as well as the California Tax Credit of $10,000, totaling 18,000
Comments(2)