Tax Credit

$8,000 First Time Homebuyer & $6,500 Move Up / Repeat Homebuyer Tax Credit

President Signs Housing Tax Credit Extension and Expansion

In Friday, November 6, 2009, President Barack Obama approved the extension as part of a $24 billion economic stimulus bill signed Friday. The Worker, Homeownership, and Business Assistance Act of 2009 also includes an extension of unemployment benefits to the longtime jobless and tax credits for some businesses. The implications of this legislation for the real estate markets are extremely significant. Not only does the Act extend the extremely popular $8,000 first time homebuyer tax credit until the middle of next year, it also expands the program by including a $6,500 credit for move-up buyers.

The real estate markets have been recovering in many parts of the country due to a variety of factors. These factors include lower home prices and historically low interest rates. Together, these factors have made homeownership the most affordable it has been in decades. Add the fact that the government will provide a significant incentive to purchase homes and many see a once-in-a-lifetime opportunity. It is important to note that this program is for a limited time. Listing inventories have already shrunk by a significant percentage in many areas of the country. These conditions warrant quick action by those thinking of purchasing a home.

The following information on the tax credit was posted on the National Association of Home Builders Website. Expect more information to be available in the coming weeks.

$8,000 First-time Home Buyer Tax Credit at a Glance

  • The $8,000 tax credit is for first-time home buyers only. For the tax credit program, the IRS defines a first-time home buyer as someone who has not owned a principal residence during the three-year period prior to the purchase.
  • The tax credit does not have to be repaid.
  • The tax credit is equal to 10 percent of the home´s purchase price up to a maximum of $8,000.
  • The tax credit applies only to homes priced at $800,000 or less.
  • The tax credit now applies to sales occurring on or after January 1, 2009 and on or before April 30, 2010. However, in cases where a binding sales contract is signed by April 30, 2010, a home purchase completed by June 30, 2010 will qualify.
  • For homes purchased on or after January 1, 2009 and on or before November 6, 2009, the income limits are $75,000 for single taxpayers and $150,000 for married couples filing jointly.
  • For homes purchased after November 6, 2009 and on or before April 30, 2010, single taxpayers with incomes up to $125,000 and married couples with incomes up to $225,000 qualify for the full tax credit.

For more detailed information on the first-time homebuyer tax credit: http://www.federalhousingtaxcredit.com/faq1.php

The $6,500 Move-Up / Repeat Home Buyer Tax Credit at a Glance

  • To be eligible to claim the tax credit, buyers must have owned and lived in their previous home for five consecutive years out of the last eight years.
  • The tax credit does not have to be repaid.
  • The tax credit is equal to 10 percent of the home´s purchase price up to a maximum of $6,500.
  • The tax credit applies only to homes priced at $800,000 or less.
  • The credit is available for homes purchased after November 6, 2009 and on or before April 30, 2010. However, in cases where a binding sales contract is signed by April 30, 2010, the home purchase qualifies provided it is completed by June 30, 2010.
  • Single taxpayers with incomes up to $125,000 and married couples with incomes up to $225,000 qualify for the full tax credit.

For more detailed information on the move-up / repeat buyer tax credit: http://www.federalhousingtaxcredit.com/faq2.php

We look forward to serving your home purchase needs in the coming months during these exciting times.
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For more information about how this program
can help you buy your home, please call:
502-244-4041 
or send an e-mail to:
Info@GreaterLouisvilleHomes.com?subject=8K