It’s Official - Homebuyer Tax Credit Extended

Moving to Austin or looking to buy a central Austin home for sale? It has just been made easier!  The Homebuyer Tax Credit is officially extended.  The bill signed by President Obama on November 6^th not only extends the credit, but it also expands it to include current homeowners.  The new credit of $6500 is intended for current homeowners looking to purchase a new primary residence.  The new measures go into effect on December 1, 2009.  A summary of the changes follow:

 First-Time Homebuyer Tax Credit Information

• To qualify the purchaser must not have owned a home in the last 3 years.  Purchaser must owner-occupy the home.
• The tax credit is equal to 10% of the purchase price of the home, not to exceed $8000.
• Qualifying maximum income limits effective on December 1^st, 2009:
                $125,000 Adjusted Gross Income for Individuals
                $225,000 Adjusted Gross Income for Married Couples
• If a taxpayer owes less than the tax credit, the government will send a check for the difference.  If the taxpayer is due a credit, the reimbursement will be the refund due + the tax credit.
• Binding Contract Provision:  To qualify for the tax credit, the purchaser must have a binding contract effective on or before April 30, 2010 with the closing happening before July 1^st, 2010

 Current Homebuyer Tax Credit Information

• To qualify the purchaser must document that their sold home or home being sold was used as a principal residence consecutively for 5 of the last 8 years.  Purchaser must owner-occupy the home.
• The tax credit is equal to 10% of the purchase price of the home, not to exceed $8000.
• Qualifying maximum income limits effective on December 1^st, 2009:
                $125,000 Adjusted Gross Income for Individuals
                $225,000 Adjusted Gross Income for Married Couples
• If a taxpayer owes less than the tax credit, the government will send a check for the difference.  If the taxpayer is due a credit, the reimbursement will be the refund due + the tax credit.
• Binding Contract Provision:  To qualify for the tax credit, the purchaser must have a binding contract effective on or before April 30, 2010 with the closing happening before July 1^st, 2010

Purchasers are eligible to claim the credit on their 2009 or 2010 tax return.  We recommend you discuss the details of how you should file with your CPA.   With these tax credits and the current interest rates, there has never been a better time to purchase a home.  Please contact us to begin your Austin home search.