County Home Buyer Resources
First-Time Homebuyer Tax Credit
Obama has signed legislation to extend the Homebuyer
Tax Credit. Passage of the bill was widely anticipated to
further spur economic recovery in the housing sector, as more
buyers are now eligible for tax breaks under the new law. The
$8,000 first-time homebuyer tax credit was originally set to
expire on November 30.
addition to offering the $8,000 first-time homebuyer
tax credit, the new law also allows a $6,500 credit for repeat
or move-up homebuyers who have lived in their primary
residence for five years or more. The
tax credits are available to buyers who sign purchase
agreements on a new or existing primary residence between
December 1, 2009, and April 30, 2010. Buyers would have until
June 30 to close on their new homes.
is an $800,000 price limit on all homes eligible for
the credit. The income limits for all buyers are now $125,000
per year for individuals and $225,000 for married couples.
Under the old program, the limits were $75,000 and $150,000
respectively. The first-time homebuyer credit is also
available to those who have not owned a home in the previous
three years. The credit does not have to be repaid unless the
home is sold or ceases to be the primary residence within
Federal first time home buyer tax credit has now expired, but
the State of California is offering a new home buyer
incentive! Read the details here:
home sales jumped 7.2% in July
— the biggest monthly gain on record. First-time homebuyers
are purchasing about one third of all homes sold. This is
largely due to the tax incentive, interest rates hovering at
historic lows and housing affordability at its best level in
more than a decade.
first-time homebuyers can claim 10% of the purchase
price up to $8,000, or $4,000 for married individuals filing
separately. The credit is available for purchases completed on
or after January 1, 2009, and before December 1, 2009. The
credit is refundable, meaning recipients receive a check for
any claim amount beyond what’s owed in taxes.
for the first-time homebuyer credit is determined by
the date of the completed purchase, not the date of occupancy.
One exception is if the home is being constructed, then the
date of occupancy is considered the date of purchase. The home
must be used as a primary residence (generally defined as
where an individual spends more than 50% of their time). To be
eligible, the buyer, or either spouse, cannot have owned and
used a home as a primary residence within the last three
years. A taxpayer who owned a rental property but not a
primary residence within the past three years is eligible for
credit does not have to be repaid unless the home is
sold or ceases to be the primary residence within three years.
There are some exceptions: homes sold as part of a divorce
settlement, homes destroyed in a natural disaster, homes
subject to condemnation, etc.
be eligible for the credit, the home cannot be
inherited, received as a gift, or purchased from a spouse or
related person. The credit applies to any type of new or
existing dwelling. Even some houseboats and manufactured homes
used as primary residences are eligible. The $8,000 tax credit
phases out for individuals with modified annual gross income
(MAGI) of $75,000 to $95,000 and married couples with MAGI of
$150,000 to $170,000.
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Congratulations on your
decision to purchase your first home! If you are looking for
assistance with your first home, you have come to the right
place! Please call me to arrange a consultation with my
team. We can help you with all phases of your purchase, from
showing you your home to referring you to financing.