There is great news for consumers looking into buying a home! Congress has recently voted for further legislation, as a portion of the strategy for energizing the U.S. real estate market, that makes the Federal tax credit of up to $8,000 now available to many more first-time buyers. Additionally, selected people who currently own a home and want to purchase a new one will also be eligible for a Federal tax credit of up to $6,500.
The Extended Home Buyer Tax Credit extends and improves the existing law that is no longer in effect on Nov. 30. Both first-time and move-up buyers may now benefit from the new tax credit. Of course, this is in addition to today's historically low mortgage interest rates.
Outlining the new legislation's particulars::
* The first-time buyers' $8,000 has now been extended through the end of April, 2010. * Individuals who currently own a home are now eligible for a $6,500 tax credit, if they have resided in the residence they are selling as their primary home for five straight years within the last eight years. * Income limits for qualifying home buyers were increased to a range of $75,000 to $125,000 (for single buyers) and a range of $150,000 to $225,000 for couples. * Time has been added to allow for closing the home purchase. As long as they have a legal contract by the last day of April, they will then have until June 30, 2010, to close the purchase. The qualifying purchase price of the new residence must be $800,000 or less.
Additional details:
* Tax credits grant a dollar-for-dollar payment of taxes owed with any surplus funds available as a refund. The amount of the credit will be first credited toward any tax liability for the purchase year. After that the amount remaining will be paid to the buyer. (For example a first-time buyer whose tax liability is $2000 would receive a payment of $6,000). * Any single-family residence purchased to be used as a principal residence (including condos, co-ops) will qualify assuming that it is purchased by the 30th of April, 2010 and closed by the 30th of June, 2010. * The full amount of the credit may be claimed by individuals with an adjusted gross income of no more than $125,000 or $225,000 on a joint return. Above those incomes, the amount of the tax credit is reduced until the maximum limit is reached - $145,000 for an individual or $245,000 of joint income.
The Extended Home Buyer Tax Credit extends and improves the existing law that is no longer in effect on Nov. 30. Both first-time and move-up buyers may now benefit from the new tax credit. Of course, this is in addition to today's historically low mortgage interest rates.
Outlining the new legislation's particulars::
* The first-time buyers' $8,000 has now been extended through the end of April, 2010. * Individuals who currently own a home are now eligible for a $6,500 tax credit, if they have resided in the residence they are selling as their primary home for five straight years within the last eight years. * Income limits for qualifying home buyers were increased to a range of $75,000 to $125,000 (for single buyers) and a range of $150,000 to $225,000 for couples. * Time has been added to allow for closing the home purchase. As long as they have a legal contract by the last day of April, they will then have until June 30, 2010, to close the purchase. The qualifying purchase price of the new residence must be $800,000 or less.
Additional details:
* Tax credits grant a dollar-for-dollar payment of taxes owed with any surplus funds available as a refund. The amount of the credit will be first credited toward any tax liability for the purchase year. After that the amount remaining will be paid to the buyer. (For example a first-time buyer whose tax liability is $2000 would receive a payment of $6,000). * Any single-family residence purchased to be used as a principal residence (including condos, co-ops) will qualify assuming that it is purchased by the 30th of April, 2010 and closed by the 30th of June, 2010. * The full amount of the credit may be claimed by individuals with an adjusted gross income of no more than $125,000 or $225,000 on a joint return. Above those incomes, the amount of the tax credit is reduced until the maximum limit is reached - $145,000 for an individual or $245,000 of joint income.
About the Author:
Jim Navary has been a freelance writer and researcher for more thirty years covering a wide range of topics. He is also a licensed real estate salesperson in the Commonwealth of Virginia specializing in real estate in the Tri-Cities area of Virginia and, in particular, Fort Lee, Virginia, area properties for sale.
