First-time Homebuyers Tax Credit Extension Is Official

Great news! The extension for the First-time homebuyers tax credit is official. And it’s not limited to first-time homebuyers, either! First-time homebuyers (that is, people who have not owned a home within the last 3 years) may be eligible for the tax credit of 10% of the purchase price of the home, up to $8,000.

Homeowners who have owned and occupied a primary residence for a period of five consecutive years during the last eight years, may qualify for a tax credit of up to $6,500.

 In order to qualify for the credit, all contracts need to be in effect no later than April 30, 2010 and close no later than June 30, 2010.

It’s important to remember that the tax credit is just that… a tax credit – a dollar-for-dollar tax reduction, rather than a reduction in a tax liability. If you owe nothing, you will receive the tax credit in full. If you have a refund coming back, you will receive the refund plus the tax credit. If you owe taxes, you will receive the tax credit minus the amount you owe.

The amount of income someone can earn and qualify for the full amount of the credit has been increased.

Single tax filers who earn up to $125,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit, however, single filers who earn $145,000 and above are ineligible.

Joint filers who earn up to $225,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit, however, joint filers who earn $245,000 and above are ineligible.

Qualifying buyers may purchase a property with a maximum sale price of $800,000.

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Remember, the new tax credit program includes a number of details and qualifications. For more information or answers to specific questions, please call or email me today.

In addition, you may be able to benefit from additional housing related provisions, including the following:

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Tax Incentives to Spur Energy Savings and Green Jobs

This provision is designed to help promote energy-efficient investments in homes by extending and expanding tax credits through 2010 for purchases such as new furnaces, energy-efficient windows and doors, or insulation.

Landmark Energy Savings

This provision provides $5 Billion for energy efficient improvements for more than one million modest-income homes through weatherization. According to some estimates, this can help modest-income families save an average of $350 a year on heating and air conditioning bills.

Repairing Public Housing and Making Key Energy Efficiency Retrofits To HUD-Assisted Housing

This provision provides a total of $6.3 Billion for increasing energy efficiency in federally supported housing programs. Specifically, it establishes a new program to upgrade HUD-sponsored low-income housing (for elderly, disabled, and Section 8 to increase energy efficiency, including new insulation, windows, and frames.

Expanding Housing Assistance

This provision increases support for several critical housing programs. It includes $2 Billion for the Neighborhood Stabilization Program to help communities purchase and rehabilitate foreclosed, vacant properties.