GREAT NEWS FOR HOME BUYERS!!!
The house voted today to extend the $8000 first time home buyers tax credit. President Obama is expected to sign the bill tomorrow morning, 11/06/09.
A new provision for a $6500 tax credit to borrowers who have lived in their current home for at least 5 consecutive years out of the past 8 years and wish to purchase a new home was also passed.
Example:
You purchased a home in 2002, lived there for 5 years as your primary home, moved out in 2007, and turned that home into a rental property. If you decide to buy a new primary residence today, you would qualify for the $6,500 tax credit based on the fact that you lived in the same residence as your primary home for at least five consecutive years out of the past eight.
Both credits apply to contracts signed by April 30, 2010 and that close by June 30, 2010. These credits are only available for purchasing a principal residence priced at $800,000 or less.
The bill would raise the adjusted gross income cap to $125,000 for single filers and $225,000 for joint filers. The amount of the credit currently begins to phase out for taxpayers whose adjusted gross income is more than $75,000, or $150,000 for joint filers.
Firsttime homebuyers are defined as someone who has not owned a residence within the past 3 years.
NOTES:
- If two unmarried individuals buy a home, and only one of the individuals qualifies for the credit based on their income or past home ownership status, the individual who qualifies for the credit can claim the full credit.
- For married couples, both spouses must qualify for the credit.
- The credit applies even if you have co-signers on your mortgage loan.