Homebuyer Credit is about to Expire
Posted by Thomas J. Bogar on April 28, 2010
The deadline for the $8,000 first-time and $6,500 long-time homebuyer credit expires this month. Under the Worker, Homeownership and Business Assistance Act of 2009, signed into law on Nov. 6, 2009, an eligible taxpayer must buy, or enter into a binding Agreement of Sale on a principal residence on or before April 30, 2010. Closing on the sale must occur by June 30, 2010.
For qualifying purchases in 2010, taxpayers have the option of claiming the credit on either their 2009 or 2010 return. For qualifying purchases in 2010, taxpayers have the option of claiming the credit on either their 2009 or 2010 return. The credit is fully refundable meaning it will either be paid to eligible taxpayers although they may not owe any taxes or if the credit is more than the taxes they owe.
To be first-time homebuyer, you and your spouse – if you are married – must not have jointly or separately owned another principal residence during the three years prior to the date of purchase. For the long-time resident homebuyer, you and your spouse – if you are married – must have lived in the same principal residence for any consecutive five-year period during the eight-year period that ended on the date the new home is purchased.
To be eligible for the credit, adjusted gross income for individual taxpayers must have less than $125,000 and for married couples filing jointly must less than $225,000.
Specific documentation and reporting is required before obtaining either credit. You should see your tax planner for the details.
