The House and Senate passed a bill this week that would extend the first time homebuyers tax credit through April 30, 2010. It is expected to be signed by President OBama today.
Under the new terms real estate buyers must be in contract to purchase a home by April 30, 2010 and have until July 1, 2010 to complete the sale. The term “first time homebuyer” can be misunderstood in this aspect. The definition for first time homebuyer eligibility is as follows, the purchaser must not have had interest in a principal residence for three years prior to the purchase.
The amount of the credit is $8000 or $4000 if married filing separate. The incomes limits have also increased from $75,000 to $125,000 for a single person and from $150,000 to $225,000 for married. Additionally they have placed a cap on the purchase price of home at $800,000. This takes the pressure off homebuyers who have been scrambling to find a home but were unable to meet the original deadline.
Good news for real estate sellers as well, there is an additional credit of $6500 offered to those who sell their current home and purchase a primary residence. Eligibility for this credit is limited to homeowners who have utilized the home being sold for 5 of the past 8 years as their principle residence. This may take some of the financial burden off of sellers who are currently experiencing a decline in property values. This credit is also subject to the $800,000 purchase price cap. This credit is not valid on the sale of vacation homes.
Take advantage of the unbeatable home prices in the Indianapolis real estate market and receive an $8000 tax credit. Contact your Realtor today!