There's wonderful news for people considering buying a home! Congress has recently voted for further legislation, as a portion of the strategy for stimulating the U.S. real estate market, that makes the Federal tax credit of up to $8,000 now available to even more first-time buyers. In addition, certain people who currently own a home and want to purchase a new one will also be able to obtain a Federal tax credit of up to $6,500.
The Extended Home Buyer Tax Credit extends and improves the existing program which is no longer in effect on Nov. 30th. Both new and move-up buyers can now benefit from the new tax credit. Needless to say, this is over and above today's historically low home loan interest rates.
Outlining the new legislation's particulars::
* The first-time buyers' $8,000 has been extended through April 30, 2010. * Current homeowners are now eligible for the $6,500 tax credit, provided they have lived in the home they are selling as their principal home for five straight years out of the past eight years. * Income limits for qualifying home buyers were increased to a range of $75,000 to $125,000 (for single buyers) and a range of $150,000 to $225,000 for couples. * Time has been added to make allowance for closing the home purchase. As long as they have a ratified contract by the 30th of April, they will subsequently have until June 30, 2010, to close the transaction. * In order to qualify, the purchase price of the home must be no more than $800,000.
Additional details:
* Tax credits provide a dollar-for-dollar reduction of taxes owed with any surplus funds available as a refund. The amount of the credit will be first applied to any tax liability for the purchase year. Next the remainder will be paid to the buyer. (For example a first-time buyer whose tax liability is $2000 would receive a payment of $6,000). * Any single-family home purchased to be used as a principal residence (including condominiums, co-ops) will qualify assuming that it is purchased by April 30th, 2010 and closed by the last day of June, 2010. * The full amount of the credit may be claimed by individuals who have an adjusted gross income of no more than $125,000 or $225,000 on a joint return. Above those incomes, the amount of the tax credit drops until the upper limit is reached - $145,000 for individuals or $245,000 of joint income.
The Extended Home Buyer Tax Credit extends and improves the existing program which is no longer in effect on Nov. 30th. Both new and move-up buyers can now benefit from the new tax credit. Needless to say, this is over and above today's historically low home loan interest rates.
Outlining the new legislation's particulars::
* The first-time buyers' $8,000 has been extended through April 30, 2010. * Current homeowners are now eligible for the $6,500 tax credit, provided they have lived in the home they are selling as their principal home for five straight years out of the past eight years. * Income limits for qualifying home buyers were increased to a range of $75,000 to $125,000 (for single buyers) and a range of $150,000 to $225,000 for couples. * Time has been added to make allowance for closing the home purchase. As long as they have a ratified contract by the 30th of April, they will subsequently have until June 30, 2010, to close the transaction. * In order to qualify, the purchase price of the home must be no more than $800,000.
Additional details:
* Tax credits provide a dollar-for-dollar reduction of taxes owed with any surplus funds available as a refund. The amount of the credit will be first applied to any tax liability for the purchase year. Next the remainder will be paid to the buyer. (For example a first-time buyer whose tax liability is $2000 would receive a payment of $6,000). * Any single-family home purchased to be used as a principal residence (including condominiums, co-ops) will qualify assuming that it is purchased by April 30th, 2010 and closed by the last day of June, 2010. * The full amount of the credit may be claimed by individuals who have an adjusted gross income of no more than $125,000 or $225,000 on a joint return. Above those incomes, the amount of the tax credit drops until the upper limit is reached - $145,000 for individuals or $245,000 of joint income.
About the Author:
Jim Navary has been a freelance writer and researcher for more thirty years covering a broad range of subjects. He is also a licensed real estate salesperson in the Commonwealth of Virginia specializing in real estate in the Tri-Cities area of Virginia and, in particular, Colonial Heights, Virginia, area houses for sale.
