Detailed Information on Tax Credit!

Here are details on the extension and expansion of the U.S. tax credit for homebuyers signed into law by President Obama:

Deadline Extended Into 2010
The tax credit was originally to end November 30, 2009. It has now been extended into 2010. If you have a signed purchase agreement by April 30, and close the transaction by July 1, you’re eligible for the credit.

Some Existing Homeowners Now Eligible
First-time homebuyers are eligible for a credit of 10 percent of the price of the home, up to $8,000. (Married couples filing individually can receive $4,000 each.) You are considered a first-time buyer if you haven’t owned a principal home in the U.S. in the last three years.

The tax credit has also been expanded to existing homeowners who’ve lived in their principle residence for five consecutive years in the last eight. They can receive up to $6,500 – or $3,250 for couples filing as individuals.

Caps on Income, Home Price
Individuals who earn up to $125,000, and couples who earn up to $225,000, are eligible for the full credit. Individuals who earn between $125,000 and $145,000 – and couples who earn between $225,000 and $245,000 – can receive a percentage of the full credit.
The maximum purchase price is $800,000. Any home selling for more than that makes the buyer ineligible for the credit.

Taking Advantage of the Credit
You can claim the credit on your 2009 or 2010 tax return, or file an amended 2008 return to get the money sooner. There are also programs in place to enable you to use the funds to help with the down payment.

Contribution to the Economy
National Association of REALTORS® economists estimate that the tax credit has contributed more than $22 billion to the economy, and that 2 million people will take advantage of it this year.