You may have caught wind of the recent $8,000 Tax Credit Extension, but may be wondering what this entails and how it applies to you.  Even if you’re not a first time home buyer; keep reading!  There have been exciting additions in hopes of getting the nation’s housing market back on its feet!

Who Qualifies for the Tax Credit?

  • First-time home buyers who purchase homes before April 30, 2010.
    • Note:  To qualify as a “first-time home buyer” the purchaser or his/her spouse may not have owned a residence during the three years prior to the purchase.
  • Current home owners who buy a home before April 30, 2010. 
    • Note:  You must have lived in the home being sold or vacated for five of the past eight years.

What type of Homes are Included?

  • Any of the Following: single-family homes, condos, townhomes, and co-ops.

What is the Tax Credit Amount?

  • $8,000 or 10% of the purchase price if less than $8,000 for first time home buyers.
  • $6,500 for current home owners
    • Note: Each home buyer’s tax credit is determined by:
      • The price of the home.
      • The buyer's income.

Is there a Price Limit on the Home I Can Buy?

  • Yes.  The tax credit only applies to homes under $800,000.

Are there Salary Limitations?

  • Yes.  These have been raised to incomes up to $125,000 for single buyers and up to $225,000 for married couples. 

What if My Salary Exceeds the Salary Limit: Can I Still Receive some Credit?

  • The full amount of the credit is available for individuals that make no more that $125,000 ($225,000 on a joint return). The credit phases out above those caps ($145,000 for singles and $245,000 for joint returns). This means if you make in between these amounts ($125,000 - $145,000 for individuals and $225,000 - $245,000 for joint filers), you can still qualify for a partial credit.

What if I am in Contract, but have not purchased the Home by April 30, 2010?

  • As long as you are in a written contract to buy the home, you will still be eligible.  However, you must close on the home before July, 2010 or you will not receive the credit.

Will I Need to Repay the Credit?

  • No!  If you buy a home and occupy the home for three years or more- you will not be required to repay the tax credit.  If you sell the property during this three year period, the full amount of the tax credit will be forfeited on the sale.

It may seem overwhelming to navigate through this process- I’m here to help with any questions you may have.  Don’t hesitate to call (630.567.5902) or email me to discuss in detail!