Posts Tagged ‘tax credit extension’

Via Mike Jones (SUNSTREET MORTGAGE, LLC):

$8,000 / $6,500 Tax Credit Legislation Extended and Modified for Home Buyers

Until the new legislation was signed into law, first time homebuyers could apply for and receive a tax credit in the amount of $8,000. when they purchased a home before the sunset date of November 30, 2009.

The new legislation, signed into law by President Obama on Friday, November 6, 2009

• extends that date until April 30, 2010 for civilians, and to April 30, 2011 for certain military buyers.
• increases the income limits so that millions more can qualify for the tax credit, and
• enacts a reduced tax credit of $6,500 for move-up buyers who are not first time homebuyers.

Extended Timeframe

The existing sunset date established by the Housing & Economic Recovery Act of 2008 has been extended to April 30, 2010 for most buyers. Qualifying members of the military who served outside the borders of the United States at any time during the period from 1/1/2009 to 4/30/2010 will have an extra year to apply for the tax credit.

Increased Income Limits

The earlier legislation put caps on income for single buyers at $95,000. Married buyers filing jointly capped out at $170,000. The new legislation allows single wage earners to make up to $145,000, and married couples can earn up to $245,000.

NEW: $6,500 Tax Credit for Move-up Buyers

The new legislation provides a tax credit incentive for people who are not first time homebuyers. (A first time homebuyer is defined as one who has not owned a home in the last 36 months.) You may qualify for this $6,500 tax credit if you owned and lived in your home for five consecutive years out of the past eight. Who does that help? Let’s say you sold your home in 2008. You’re not a first time homebuyer, but if you meet the “five of eight” criteria, you can buy a move-up home and still qualify for the $6,500 tax credit. Check with your tax professional for advice on your particular situation.

NOTE: Additional Requirements

There are other rules of eligibility in the legislation. (This list is not exhaustive, so you’ll want to check with your tax professional.)

• You can’t buy the home from a relative.
• You must be 18 or older
• You cannot be claimed by any other taxpayer as a dependent
• If you’ve sold a home, and that sale affects your eligibility, you must included the settlement statement (HUD-1) with your tax return.
• Most buyers (check with your tax professional) must live in the home for a minimum of three years or face a government demand for repayment.

Above originally published on InvestmentRealEstateCorner.com by Mike in Tucson

Helpful links regarding the tax credits:

Basic explanation of the extension/expansion for 2009/2010

Quick chart of features (pdf file format)

Form to amend taxes if you close in 2009 (pdf file format)

Helpful article if buying & selling a home at the same time: if you are leaving your starter home for a larger home, read this to find out how to sell and buy at the same time!

Lori is a residential Realtor with Chinowth & Cohen Realtors serving the greater Tulsa area, including midtown Tulsa, downtown Tulsa, Broken Arrow, Owasso, Bixby, Sand Spring and Jenks, Oklahoma. Please visit Lori’s web site, LoriCain.com or call 918-852-5036.

Outgrown your starter home? NOW is the time to upgrade & here are three reasons why.

Okay, it’s time to sell your house.

You’ve outgrown that cute little starter home with two bedrooms and 1 bath that you bought after you got married and before you had two children. It’s time to pass that along to another young couple and find a larger home in a school district of your choice with a separate bathroom for the kiddos.

You may have heard that the Senate & House extended the 1st-time home buyer $8,000 tax credit. They ALSO added a $6,500 credit for home buyers who have lived in their current home at least five years – this is an effort to get the $200K-$300K inventory of homes moving.

Both have to have written contracts by April 30th and must close by June 30th.

I know that you’re nervous about trying to buy a home while selling yours at the same time. The thought of double mortgage payments scares me, so I know it scares you. Here is a post I’ve written about how best to buy and sell at the same time – it can be done! 

Your home is likely to be purchased by a 1st-time buyer, so you really need to take advantage of this opportunity now that they’ve extended the deadline. Honestly, towards the end of the original deadline, the inventory of homes in 1st-time Buyers’ price range was getting scarce – in fact, prices were getting somewhat inflated, because buyers were panicking that they would not close in time. Now that the deadline is extended, I expect the frenzy to start up again.

The legislature added the $6,500 credit to existing home-owners needing to upgrade in an effort to stimulate the inventory of homes in the $200K-$300K range – something the 1st-time buyers couldn’t afford. There are a plethora of homes in that price range that have been on the market a while, so good deals are available.

So, you want to get your home ready to market to first-time buyers AND you can cash in on the $6,500 credit on your purchase. Rates are still low, and we have no clue how long that will last.

It’s time to make the move up NOW, because:

1. Your home will likely be purchased by a 1st-time buyer taking advantage of the stimulus extension;
2. You can cash in on the $6,500 credit since you’ve owned your current home for five+ years, and finally,
3. Rates are great.

So, what are you waiting for? The stars may not align like this again for several years.

Let’s get your home ready to put on the market and set up a search for your larger dream home.

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Bringing the Dream of Homeownership Within Reach (Source: National Association of Realtors)

As part of its plan to stimulate the U.S. housing market and address the economic challenges facing our nation, Congress has passed new legislation that:

• Extends the First-Time Home Buyer Tax Credit of up to $8,000 to first-time home buyers until April 30, 2010.

• Expands the credit to grant a $6,500 credit to current home owners purchasing a new or existing home between the date the bill is signed by President Obama and April 30, 2010.

Helpful links regarding the tax credits:

Basic explanation of the extension/expansion

Quick chart of features (pdf file format)

Form to amend taxes if you close in 2009 

About the author: Lori Cain is a residential Realtor with Chinowth & Cohen Realtors, serving the greater Tulsa area. Please visit Lori’s web site, LoriCain.com or call 918-852-5036!