· Extends the First-Time Home Buyer Tax Credit of up to $8,000 to first-time
home buyers until April 30, 2010.
· Expands the credit to grant up to $6,500 credit to current home owners purchasing
a new or existing home between November 7, 2009 and April 30, 2010.
:Here is a summary of the new tax credit rules.
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EXTENSION OF FIRST-TIME BUYER CREDIT |
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Jan. 1 – Nov. 30, 2009 |
Nov. 7 – Apr. 30, 2010 |
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First-time Buyer |
$8000 |
$8000 |
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First-time Buyer |
May not have had an interest in a principal residence for 3 years prior to purchase |
Same |
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Jan. 1 – Nov. 30, 2009 |
Nov. 7 – Apr. 30, 2010 |
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Current Homeowner Amount of Credit |
No Provision |
$6500 |
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Effective Date |
No Provision |
November 7, 2009 |
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Current Homeowner |
No Provision |
Must have used home as a principal residence consecutively for 5 of the previous 8 years |
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Termination of Credit |
Purchases after Nov. 30, 2009. |
Purchases after April 30, 2010 |
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Income Limits |
$75,000 – single |
$125,000 – single |
NEW RULES
The revised tax credit has several rules that were not outlined in the previous legislation:
- Binding Contract Rule. So 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.
- Limitation on Cost of Purchased Home. Effective November 7, 2009, there is an $800,000 limit on the home cost.
- Purchase by a Dependent. As of November 7, 2009, this is explicitly ineligible for the credit.
- Anti-Fraud Rule. Purchasers must now attach documentation of the purchase to their tax returns.
