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Lawrence Board of REALTORS®
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Services Members get an
extra year to take advantage
of the Homebuyer Tax Credit. |
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Members of the U.S. military, foreign service and intelligence communities have another year to purchase a home and claim the home buyer tax credit.
Any service member who is or has been on extended duty for 90 days or more between Jan. 1, 2009 to April 30, 2010, has until April 30, 2011, to sign a sales contract and until June 30, 2011, to close on the property. Both the $8,000 first-time and the $6,500 repeat home buyer tax credits are included in the extension.
The rule that requires buyers to repay the credit if they move out of their home within three years has also been waived for qualified service members if they receive government orders to move.
Source: The National Association of Home Builders (04/26/2010)
INFORMATIVE DETAILS ABOUT THE TAX CREDIT
Enter into a contract to purchase a home prior to April 30, 2010, and close prior to June 30, 2010, and the U.S.
government has a substantial incentive for you. For those eligible, current homeowners can receive a $6,500 tax credit, while first-time buyers are eligible for an $8,000 credit*. For qualification details, work with a REALTOR®, a member of the National Association of REALTORS®. They can explain the process and show you options that best fit your situation. For more information, visit and bookmark
HouseLogic.com/homebuyertaxcredit.
* Worker, Homeownership & Business Act of 2009. Restrictions may apply, not all home buyers will qualify for the full amount.
HOW TO GET THE TAX CREDIT
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Verify that you are a qualified first-time buyer under IRS guidelines to receive the $8,000 tax credit, or Verify that you qualify as an existing owner of a home purchasing a primary residence to receive the $6,500 tax credit. (see below for qualifying guidelines)
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Who Qualifies?
- First-time home buyers who purchase homes between November 7, 2009 and April 30, 2010.
- 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.
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To qualify as a “first-time home buyer” the purchaser or his/her spouse may not have owned a residence during the three years prior to the purchase.
If you or your client purchased a home between January 1, 2009 and November 6, 2009, please see: 2009 First-Time Home Buyer Tax Credit.
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 Will the Credit Be?
The maximum allowable credit for first-time home buyers is $8,000.
The maximum allowable credit for current homeowners is $6,500.
How is a Buyer's Credit Amount Determined?
Each home buyer’s tax credit is determined by two additional factors:
- Price
Under the Extended Home Buyer Tax Credit, credit may only be awarded on homes purchased for $800,000 or less.
- Buyer Income
Under the Extended Home Buyer Tax Credit, which is effective on November 7, 2009, single buyers with incomes up to $125,000 and married couples with incomes up to $225,000—may receive the maximum tax credit.
These income limits have changed from the 2009 First-Time Home Buyer Tax Credit limits. If you or your client purchased a home between January 1, 2009 and November 6, 2009, please see 2009 First-Time Home Buyer 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 the three-year period, the credit will be recouped on the sale.
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