There’s been a lot of buzz throughout Ulster County & the Hudson Valley, along with the rest of the industry for weeks regarding the Home Buyers Tax Credit. By now, I’m sure you’ve heard of the First Time Home Buyer Tax Credit being extended, and you may have heard that there have been some improvements. So, here’s a breakdown of the basics……
The Home Buyers Tax Credit for 2009 was for first time home buyers that purchased a residential home by Dec. 1 2009. But the Extended version has made it possible for people to qualify up until April 30, 2010.
The “Improved” part Of the Home Buyers Tax Credit means that you may qualify if you didn't before. The income level has risen and no longer is limited to first time home buyers.
So here are some basic Q & A’s…..
Which Properties Are Eligible?
The Extended Home Buyer Tax Credit may be applied to primary residences, including: single-family homes, condos, townhomes, and co-ops.
How Much Is Available?
The maximum allowable credit for first-time home buyers is $8,000.
The maximum allowable credit for current homeowners is $6,500.
Pay Rate to Qualify? Effective Nov. 7, 2009
Wage earnings for a Single Income has jumped to 125,000
Wage earnings for Family Income has jumped to 225,000.
Do you have to be a first time Home Buyer?
First-time home buyers who purchase homes between November 7, 2009 and April 30, 2010 still can qualify for the 8,000 Home Buyers Tax Credit. But current Home owners purchasing a home can now qualify too.
I own a home - can I qualify for the Tax Credit?
- Yes! Current home owners purchasing a home between November 7, 2009 and April 30, 2010, who have used the home being sold or vacated as a principal residence for five consecutive years within the last eight. With this Extended Version to the Tax Credit, you may be eligible for 6,500 tax credit.
If the Buyer(s)' Income Exceeds These Limits, Can He/She Still Get a Credit?
Yes, some buyers may still be eligible for the credit.
The credit decreases for buyers who earn between $125,000 and $145,000 for single buyers and between $225,000 and $245,000 for home buyers filing jointly. The amount of the tax credit decreases as his/her income approaches the maximum limit. Home buyers earning more than the maximum qualifying income-over $145,000 for singles and over $245,000 for couples are not eligible for the credit.
Can a Buyer Still Qualify If He/She Closes After April 30, 2010?
Under the Extended Home Buyer Tax Credit, as 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.
Will the Tax Credit Need to Be Repaid?
No. The buyer does not need to repay the tax credit, if he/she occupies the home for three years or more. However, if the property is sold during this three-year period, the full amount credit will be recouped on the sale.