Here in Military City USA we strive to serve those who serve our country in every way we can. This post is a reminder of the extension of the Home Buyer Tax Credits ($8000 for First Time Buyers or $6500 for Repeat Buyers).
As the article linked above explains, members of the military and certain other federal employees serving outside the U.S. have an extra year to buy a principal residence in the U.S. and qualify for the credit. Thus, an eligible taxpayer must buy, or enter into a binding contract to buy, a principal residence on or before April 30, 2011. If a binding contract is entered into by that date, the taxpayer has until June 30, 2011, to close on the purchase. Members of the uniformed services, members of the Foreign Service and employees of the intelligence community are eligible for this special rule. It applies to any individual (and, if married, the individual’s spouse) who serves on qualified official extended duty service outside of the United States for at least 90 days during the period beginning after Dec. 31, 2008, and ending before May 1, 2010.
I’d love to help you or anyone you know who is eligible for this program to take advantage of it. Contact me today at Lynn@LynnKnapik.com. Be ready to receive “Service Beyond Your Wildest Expectations!”.
On November 7, 2009 President Obama signed into law the extension of the First Time Home Buyer Tax Credit and expansion of the credit to include previous and/or current home owners.
According to statistics from the National Association of REALTORS®(NAR), 47% of home buyers last year were first time home buyers. While some think many of these buyers would have bought homes with or without the tax credit, NAR statistics show an increase of first time buyers over previous years. Personally, I had a number of first time buyers last year and this year 70% of my transactions involved first time buyers! Thank you, Congress, for this particular economic stimulus incentive.
What exactly is a Tax Credit? Well, it’s a lot better than a tax deduction – that’s for sure. Receiving a tax credit means that your tax bill owed to the IRS is reduced by the amount of the tax credit you are eligible to receive AND – the really great part – IF YOU DON’T OWN MONEY, THE IRS PAYS YOU THE AMOUNT OF THE TAX CREDIT!!! So let’s say you owe $2,000 in taxes when you prepare your return and you qualify for the full $8,000 tax credit. Then the IRS will deduct the $2,000 you owe from the $8,000 credit they owe you and they’ll send you the difference. If they owe you a refund already, they’ll add that refund to the amount of your tax credit and send you the whole kit and kaboodle!
What a deal – the government is paying you to buy a house!
Here are the main things to know:
- First-time Buyer:
- up to $8,000 credit ($4,000 married filing separately) or 10% of purchase price
- may not have had in interest in a principal residence for 3 years
- effective date of Jan. 1, 2009 through April 1, 2010 (binding contact in place by April 1, 2010 with closing taking place by July 1, 2010)
- income limit of $75,000 single or $150,000 married raised to $125,000 single and $225,000 married
- limitation on cost of house now set at $800,000
- up to $6,500 credit ($3,250 married filing separately) or 10% of purchase price
- must have lived in previous residence 5 consecutive years out of the previous 8 years
- do not have to own a house and be selling it at the time of purchasing a new one
Check this link for a comparison of the old rules and the new rules plus a lot more important information as found on the NAR website:
Want to know more? Send me an email and let’s talk about