With the signing of the Extended Home Buyer Tax Credit existing homeowners may now qualify for a $6500 Tax Credit. This new legislation is time sensitive and unfortunately does not apply to all existing homeowners. Here are the importanta points to know…
- Who qualifies – current home owners purchasing a home between November 7, 2009, and April 30, 2010, who used the home being sold or vacated as a principle residence for five consecutive years within the last eight qualify.
- Time Limits – as long as a written binding contract to purchase is in effect on April 30, 2010, the purchaser will have until July 1, 2010 to close.
- Income Limits – single buyers with incomes up to $125,000 and married couples with incomes up to $225,000 may receive the maximum tax credit. The credit decreases for buyers who earn between $125,000 and $145,000 for single buyers and betweeen $225,000 and $245,000 for home buyers filing jointly. The amount of the tax credit decreases as his/her income approaches the maximum limits. Homebuyers earning more than the maximum qualifying income – over $145,000 for singles and $245,000 for couples are not eligible for the credit.
- Price Limits – credit may only be awarded on homes purchased for $800,000 or less.
- Repayment of Tax Credit – there is no repayment of the tax credit if the purchased property is occupied for three years or more. However, if the property is sold during this three-year period, the full amount of the credit wil be recouped on the sale.
Now you know the facts. What does it mean….
- You receive the Tax Credit by purchasing a home. You are not required to sell your current home – just make the new home your principle residence for 3 years.
- You can purchase a property for a higher value or lower value than your present home.
- You must act now…April 30 is the deadline for having a house under contract
- Upon closing the new home purchase you can file an amended tax return for an immediate $6500 Tax Credit.
So remember…
- The present low prices and mortgage rates will not last forever!
- Here is the opportunity to “move” to your dream home!
[...] 2. Exising homeowner receive a $6500 Tax Credit when purchasing a new home if they have resided 5 consecutive years within the last 8 years in that property as their primary residence. That’s $6500 to put back into the mortgage to reduce the principle. [...]
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The tax credit incentives were wonderful opportunities for buyers and sellers when available. Seems there would be very few contracts out there now that this would apply to now in mid-July.
Comment by Kathy and Ben — July 12, 2010 @ 7:24 pm