On Wednesday the Senate voted 98-0 and yesterday the House voted 403-12 on legislation that includes the extension and expansion of the first time homebuyer tax credit. It is reported that the President signed the bill today.
First-time Homebuyers
The first-time homebuyer tax credit will be extended until April 30, 2010. In addition, those who have signed a contract before May 1, 2010 will have 60 days to close on the home.
Increases the income limits to $125,000 on a single return and $225,000 on a joint return.
Those who purchase in 2010 will be able to claim credit on 2009 tax return.
Definition of first-time buyer: those who have not owned a home in the last three years.
The credit will remain at $8,000.
Move-up Buyers
Those who have owned the same home for 5 consecutive of the last 8 years will be eligible for a $6,500 tax credit.
The $6,500 tax credit will be eligible for purchases between December 1, 2009 and May 1, 2010. The same opportunity to close within 60 days applies.
The income limits are also $125,000 on a single return and $225,000 on a joint return.
Those who purchase in 2010 will be able to claim the credit on 2009 tax return.
Other provisions regarding the homebuyer tax credit:
No homes over $800,000 will be eligible for the tax credit.
It will extend the tax credit for the military and other Foreign Service Officers serving abroad through April 30, 2011. It also waves the recapture fee for all military personnel should the individual move and sells the home within 3 years.
