Home Buyer Tax Credit | Maisha Dible | Reece & Nichols Real Estate, Mortgage, Closing Title Experts

The Home Buyer Tax Credit Is Now Extended & Expanded

As part of its plan to stimulate the U.S. housing market and address the economic challenges facing our nation, Congress has passed new legislation that extends the $8,000 credit for first-time home buyers, and expands the program to offer a $6,500 credit for repeat buyers who have been in their current residence for five consecutive years out of the last eight.

The qualifying income limits have also been raised to $125,000 for singles and $225,000 for joint tax payers. Under the Extended Home Buyer Tax Credit, credit may only be awarded on homes purchased for less than $800,000.

In order to be eligible for the credit, buyers must have a written sales agreements in hand by April 30, 2010. Buyers then have an additional 60 days to close on the property (June 30, 2010).

Click here to view the National Association of REALTORS® Tax Credit Comparison Chart

Who Qualifies for the Tax Credit?

First-time home buyers who have not owned a principle residence at any time during the three-year period leading up to the purchase of the home who purchase homes between January 1, 2009 and April 30, 2010.

Current home owners purchasing a home between November 6, 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.

All types of homes qualify for the credit, including single-family, townhomes, and condominiums, as long as the property purchased will be used as a primary residence.

The amount of the tax credit is up to 10% of the purchase price of the home with a maximum of $8,000 for first-time buyers and $6,500 for repeat home buyers. Single taxpayers with incomes of up to $125,000 and married taxpayers with incomes of up to $225,000 can qualify for the full tax credit. You may qualify for a partial tax credit if your income is greater than $125,000 to $145,000 for a single taxpayer and $225,000 to $245,000 for married taxpayers filing a joint return.

For more information on the First-Time Home Buyer Tax Credit, please see our Frequently Asked Questions.