The $8000 first time homebuyers income tax credit has been extended by Congress — and (hallelujah!) buyers who have owned their homes for at least five years may be eligible for a $6500 tax credit for move-up purchases. President Obama is expected to sign it into law in the next day or so.
Both buying groups must have signed a purchase agreement April 30, 2010 and closed escrow by June 30.
It appears the credits will be good on primary home purchases up to $800,000, while vacation homes don’t count. Qualifying income limits are $125,000 per year for individuals and $225,000 for joint filers. Military members serving outside the United States for at least 90 days are expected to have these credits extended an additional year–until June 30, 2011.
As an added bonus, taxpayers may be able to retroactively claim the credit on home purchases completed in 2010 on their 2009 income tax returns. At the same time, buyers must remain in their newly-purchased homes (as primary residence) for 36 months after purchase or face repayment of the credit. This latter requirement is waived for active military personnel who are transferred due to military orders.
The passage of this legislation will help relieve much of the pressure for San Diego first time home buyers.
Through August, 2009 1.2 million first time home buyers have qualified for this income tax credit and the National Association of Realtors estimates that 350,000 of these purchases are directly attributable to the first time home buyer credit. —Roberta Murphy Carlsbad, CA