Since the home buyers’ credit began, 1.4 million home buyers have taken advantage of it to earn up to $8,000 when buying a home! This success has caused the government to extend the credit until April 30, 2010.
What does it all mean?The new guidelines will be extended to:
- Home owners that have owned their current home for at least 5 years are now eligible for the credit up to $6,500.
- Further, first-time home buyers remain eligible for up to $8,000 or 10% of the cost
of the home. - First-time home buyers…
The extension of the credit is available for homes that are under agreement by April 30, 2010 and completely purchased/settled by June 30, 2010. The new regulations for this credit have a higher income limit as well, set at $125,000 for individuals and $225,000 for married couples. The credit will remain at 10% of the cost, with a maximum of $8,000. To receive these benefits, you — and if you’re married, your spouse — must be first-time home buyers, meaning that you have not owned a home in the previous 3 years. Further, unlike the tax credit of 2007/2008, this does not need to be paid back!
Repeat home buyers…
Current home owners that are looking to purchase a new home are eligible for the credit as well! To qualify as a repeat home buyer, you must have owned and lived in your current residence for 5 consecutive years. Now these home buyers can receive a credit for up to $6,500 or 10% of the cost of the home. The new home does not have to be more or less expensive than your current home. The same income limits apply as for first time home buyers.
The fine print..The fine print.. For both credits,
- The homes purchased must be less than $800,000.
- The credit is refundable, meaning it will be issued as a check to you if your tax liability is less than the refund.
- The new extension cannot be applied retroactively; for example, it cannot be used if a home was purchased before November 6, 2009 and the owners did not receive the credit because of the old income limits.
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