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Digital News Report – There may still be time to qualify for the homebuyer’s tax credit before it expires at the end of April 2010. First time homebuyers can get a check for up to $8,000 for purchasing a home. Current homeowners can receive $6,500 for buying a more-expensive home ($3,250 for a married individuals filing separately).
The tax credit for members of U.S. military “whose duty takes them overseas” has been extended until May 2011.
The smaller $6,500 tax credit will now apply to families that have lived in their home for any five-consecutive year period during the eight-year period that ended on the date the replacement home is purchased. Check with your real estate professional for all of the details.
The tax credit was set to expire last November but was extended through April. The new law also raises the income limitations for homeowners claiming the credit. According to a statement by the Whitehouse, the new home purchased must be “under contract by April 30, 2010”.
A tax credit is better than a tax deduction because the money comes directly from the tax you owe and is not deducted from your total income. So if you owe or paid $8,000 in taxes you may get your money back or not pay any taxes. Always check with your tax and finance professional before making major financial decisions.
By: Tina Brown
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If I enter a contract before April 30 but still reside in my old home until August 30, which will complete the 5 year requirement, will I be eligible for the 6500 tax credit? I intend to keep the home I am living in now, and move into the new home in September. The closing on the new home may take place June