Home Buyers Profit from the
Federal Tax Credit Extension

By Elke Duffy, Broker
Amador Realty, www.amadorrealty.com  

On November 6, 2009, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) confirmed the extension and expansion of the federal tax credit for home buyers. Extending and expanding the provisions of the Federal Tax Credit for First-time Home Buyers is certainly a big win for many more home buyers. The benefits of the federal tax credit have played a big role in the overall economic recovery. Nationwide, more than 1.4 million first-time home buyers were eligible for the initial credit and that number will surely increase dramatically in the months ahead with this new legislation in place.

 

This time around it is not only the first-time home buyer who will benefit but also existing homeowners. The federal tax credit will be extended through April 30, 2010, with a 60-day extension IF a binding contract is in place prior to the deadline. Existing homeowners will be eligible for a credit of up to $6,500, while first-time home buyers will continue to be eligible for a tax credit of up to $8,000. In order to qualify for the $6,500 credit, existing homeowners must have lived in their current residence for at least five years. Qualifying income limits have been increased from $75,000 to $125,000 for single tax filers and from $150,000 to $225,000 for joint filers. The purchase price of the home is capped at $800,000 in both instances.