Thursday, April 8, 2010

Tax Credit Deadline Reminder

There is just a month left in the first-time homebuyer extension and “move-up” tax credit opportunities. Many experts are predicting this  will be the year of the first-time home buyer, estimating a 6% increase in first-time buyer sales.  

As a reminder, here are the requirements

First-time Homebuyer
•    You must buy – or enter into a binding contract to buy a principal residence – on or before April 30, 2010.
•    If you enter into a binding contract by April 30, 2010, you must close on the home on or before June 30, 2010.
•    For qualifying purchases in 2010, you will have the option of claiming the credit on either your 2009 or 2010 return.
•    To receive credit, the purchase price must not exceed $800,000.
•    The purchaser must be at least 18 years old on the date of purchase. For a married couple, only one spouse must meet this age requirement.
•    A dependent is not eligible to claim the credit.
•    The income limits for homes purchased after Nov. 6, 2009 (the previous homebuyer credit end date) has risen since that date. The full credit is now available to homebuyers with incomes up to $125,000 individually or $225,000 for those who jointly file taxes.

Longtime Homebuyer (or “move-up”)
•    Homebuyers who have lived in the same home any five consecutive years out of the last eight can qualify for a reduced credit on their new home purchase (up to $6,500). This is great news for homebuyers interested in reinvesting or moving to a bigger home.
•    The same date requirements as first-time homebuyers apply as well as income stipulations.

It is important to remind home buyers that the tax credit does not need to be repaid. It is theirs to keep! 

Photo Source: David

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