Friday, November 6, 2009

Homebuyer Tax Credit - Extended and Expanded

first time homebuyer tax creditToday the Senate & House of Representatives extended the Homebuyer Tax Credit that was to expire on Nov. 30th. The new and expanded bill will take effect when President Obama signs it into legislation.

The new bill extends the deadline until April 30, 2010 where the homebuyer will have to have a written and binding contract to close no later than July 1, 2010.

The First-time Buyer Credit stays the same in that the buyer may not have had an interest in a principal residence for 3 years prior to the purchase. The amount will also remain at $8000.

The new bill is expanded to also cover Existing Homeowners, who must have used the home sold as a principal residence for 5 consecutive years out of the previous 8 years. The amount that they would receive will be only $6500, yet this is $6500 more than has been the case.

The income limits have risen to $125K for a single person & $225K for a married couple. These are up from $75K and $150K, respectively.

There previous was no cost limit for the purchase price of the home, but this will now be limited to a $800K home.

There is also an Anti-fraud Rule that was attached to the bill and rightly so. Now the purchaser will have to attach documentation to their tax return.

This is very good news & well needed for the real estate recovery as well as that of the economy.

Till next time…Marc It Sold!

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