Wednesday, November 18, 2009

First Time Home Buyer Tax Credit Extended

The First Time Home Buyer Tax Credit has been extended to April 30, 2010.

The new bill includes an incentive for current home owners as well. The government will offer those buyers a credit of up to $6,500 as long as they've lived in their home for five of the past eight years. The credit can only be claimed on primary residences purchased for less than $800,000. And as long as they use the property as their primary residence for three or more years after the purchase, buyers don't have to pay it back. Furthermore, buyers can claim the credit on their 2009 taxes, even if the purchase was made in 2010 by filing an amended return.

Here's a quick recap of the extension's new guidelines:

Buyers who have owned their current homes at least five years would be eligible, subject to income limits, for tax credits of up to $6,500.

First-time home buyers — or people who haven't owned a home in the previous three years — could get up to $8,000.

To qualify, buyers have to sign purchase agreements before May 1 and close before July 1.