federal housing tax credit – Jay's Real Estate Blog

Federal Tax Report – Closing Date Extended to September 30

Federal Tax Report
Closing Date Extended to September 30

It wasn’t pretty, and the debate went well into the evening, but on June 30 the Senate passed a stand-alone bill that extended the date for closing on a tax credit-eligible home from June 30 to September 30, 2010. The bill passed the Senate on a voice vote in a process known as “unanimous consent.” A stand-alone bill is a single issue bill that contains just one provision (and, if needed, its “pay-fors.”) Stand-alone tax bills are a rarity in the Senate, but the urgency was well understood. Earlier in the week, the House had passed a stand-alone extension (HR 5623) by a vote of 409 – 5.

The White House has said that President Obama will sign the bill, although the timing for the signing is not yet known. The extension is seamless, so closings that occur between July 1 and the date the President signs the legislation will satisfy the requirements of the credit. In order to get the benefit of this closing date extension, the parties must have entered into a contract for the purchase on or before April 30, 2010.

If you are thinking of buying or selling real estate in Garrett County or Deep Creek Lake, Maryland, call Jay Ferguson of Railey Realty for all of your real estate needs! 877-563-5350 Deep Creek Lake Info, Business Directories, Classified Ads, Events & more! Advertise on http://www.deepcreekalive.com/!

Congress passes extension of the Homebuyer Tax Credit closing deadline

TO: State and Local Association Presidents, State and Local
Association Executives, State and Local Association Government Affairs Directors, State and Local Association Communications Directors
FROM: NAR Government Affairs
RE: Tax Credit Closing Date Extension/Flood Insurance Extension
DATE: 30 June 2010

After a close brush with the deadline, Congress has passed an extension of the Homebuyer Tax Credit closing deadline, the Homebuyer Assistance and Improvement Act (H.R. 5623). The extension applies only to transactions that have ratified contracts in place as of April 30, 2010 that have not yet closed. The legislation is designed to create a seamless extension the new closing deadline for eligible transactions is now September 30, 2010. There is will be no gap between June 30 and the date the President signs the bill into law.

NAR worked closely with Congressional leaders on both sides of the aisle to enact this important legislation. Extending the Tax Credit Closing deadline will help provide additional stability to real estate markets across the nation.

For additional information on the extension visit www.realtor.org/government_affairs

Additionally, the United States Senate has passed the National Flood Insurance Program Extension Act of 2010 (H.R. 5569) an extension of the National Flood Insurance Program until September 30, 2010. This will allow transactions to move forward. The bill is retroactive and covers the lapse period from June 1, 2010 to the date of enactment of the extension.

For more information on the flood insurance program visit www.realtor.org/government_affairs

Tax Credit Closing Deadline Extension Passes House

TO: State and Local GADs
FROM: NAR Government Affairs
RE: Tax Credit Update
DATE: 29 June 2010 3:59 PM Eastern

The United States House of Representatives has just passed HR 5623, the
Homebuyer Assistance and Improvement Act of 2010, by a vote of 409-5. This
bill extends the deadline for closing tax credit eligible transactions from
June 30 to September, 30, 2010. The bill moves to the Senate where the
outcome is much less certain. NAR will continue to update you as the events
move forward.

The Basics: Extended Home Buyer Tax Credit 2009/2010

Bringing the Dream of Homeownership Within Reach

As part of its plan to stimulate the U.S. housing market and address the economic challenges facing our nation, Congress has passed new legislation that:

•• Extends the First-Time Home Buyer Tax Credit of up to $8,000 to first-time home buyers until April 30, 2010.
•• Expands the credit to grant up to $6,500 credit to current home owners purchasing a new or existing home between November 7, 2009 and April 30, 2010.
Here is more information about how the Extended Home Buyer Tax Credit can help prospective home buyers become part of the American dream. If you have specific questions or need additional information, please contact a tax professional or the Internal Revenue Service at 800-829-1040.

Who Qualifies for the Extended Credit?•• First-time home buyers who purchase homes between November 7, 2009 and April 30, 2010.

•• Current home owners purchasing a home between November 7, 2009 and April 30, 2010, who have used the home being sold or vacated as a principal residence for five consecutive years within the last eight.
To qualify as a “first-time home buyer” the purchaser or his/her spouse may not have owned a residence during the three years prior to the purchase.

If you or your client purchased a home between January 1, 2009 and November 6, 2009, please see: 2009 First-Time Home Buyer Tax Credit.

Which Properties Are Eligible?
The Extended Home Buyer Tax Credit may be applied to primary residences, including: single-family homes, condos, townhomes, and co-ops.

How Much Is Available?
The maximum allowable credit for first-time home buyers is $8,000.

The maximum allowable credit for current homeowners is $6,500.

How is a Buyer’s Credit Amount Determined?
Each home buyer’s tax credit is determined by two additional factors:

1.The price of the home.
2.The buyer’s income.

Price

Under the Extended Home Buyer Tax Credit, credit may only be awarded on homes purchased for $800,000 or less.

Buyer Income

Under the Extended Home Buyer Tax Credit, which is effective on November 7, 2009, single buyers with incomes up to $125,000 and married couples with incomes up to $225,000—may receive the maximum tax credit.

These income limits have changed from the 2009 First-Time Home Buyer Tax Credit limits. If you or your client purchased a home between January 1, 2009 and November 6, 2009, please see 2009 First-Time Home Buyer Tax Credit.

If the Buyer(s)’ Income Exceeds These Limits, Can He/She Still Get a Credit?
Yes, some buyers may still be eligible for the credit.

The credit decreases for buyers who earn between $125,000 and $145,000 for single buyers and between $225,000 and $245,000 for home buyers filing jointly. The amount of the tax credit decreases as his/her income approaches the maximum limit. Home buyers earning more than the maximum qualifying income—over $145,000 for singles and over $245,000 for couples are not eligible for the credit.

Can a Buyer Still Qualify If He/She Closes After April 30, 2010?
Under the Extended Home Buyer Tax Credit, as long as a written binding contract to purchase is in effect on April 30, 2010, the purchaser will have until July 1, 2010 to close.

Will the Tax Credit Need to Be Repaid?
No. The buyer does not need to repay the tax credit, if he/she occupies the home for three years or more. However, if the property is sold during this three-year period, the full amount credit will be recouped on the sale.

If you are thinking of buying or selling real estate in Garrett County or Deep Creek Lake, Maryland, call Jay Ferguson of Long & Foster Real Estate for all of your real estate needs! 877-563-5350

Buyer Client Info – Federal Housing Tax Credit

Here is some clear, concise info regarding the Federal Housing Tax credit. Keep in mind, you are on the clock: Contract by April 30, 2010, close by June 30, 2010:

http://www.federalhousingtaxcredit.com/key_info.php

Key Information

Following are key points that prospective home buyers should be aware of when considering a home purchase under the tax credit program.
•A tax credit of up to $8,000 is available for first-time home buyers purchasing on or after January 1, 2009 and on or before April 30, 2010. In cases where a binding sales contract is signed by April 30, 2010, a home purchase completed by June 30, 2010 will qualify.
•A tax credit of up to $6,500 is available for repeat home buyers who have owned a home for five consecutive years out of the prior eight years. The repeat home buyer tax credit applies to houses sold after November 6, 2009 and on or before April 30, 2010. In cases where a binding sales contract is signed by April 30, 2010, a home purchase completed by June 30, 2010 will qualify.
•Income limits of $125,000 for individuals and $225,000 for married couples filing jointly apply to all sales occurring after Nov. 6, 2009.
•The income limits for sales occurring on or after January 1, 2009 and on or before November 6, 2009 are $75,000 for individual taxpayers and $150,000 for married couples filing jointly.
•Homes priced above $800,000 are not eligible for either the first-time home buyer tax credit or the repeat home buyer tax credit.
•Expanded tax credit benefits apply to members of the military, the foreign service and the intelligence community.
•Home purchases in 2010 may be claimed on an amended 2009 income tax return.
•Persons who are claimed as dependents by a taxpayer or who are under age 18 do not qualify for a tax credit.
•Home purchases from relatives of the taxpayer or the taxpayer’s spouse do not qualify for the tax credit. The IRS defines relatives as ancestors (parent, grandparent, etc.), lineal descendants (child, grandchildren, etc.) and spouses.
•Married couples are not eligible to claim the first-time home buyer tax credit if either spouse has previously owned a home. They may, however, qualify for the repeat home buyer tax credit.
•Neither the first-time home buyer tax credit nor the repeat home buyer tax credit have to be repaid unless the home is sold or ceases to be used as the buyer’s principal residence within three years after the initial purchase.
•Taxpayers must submit a copy of the HUD-1 settlement statement and IRS Form 5405 to claim either the first-time home buyer tax credit or the repeat home buyer tax credit.

If you are thinking of buying or selling real estate in Garrett County or Deep Creek Lake, Maryland, call Jay Ferguson of Long & Foster Real Estate for all of your real estate needs! 877-563-5350

Category: federal housing tax credit

Federal Tax Report – Closing Date Extended to September 30

Congress passes extension of the Homebuyer Tax Credit closing deadline

Tax Credit Closing Deadline Extension Passes House

The Basics: Extended Home Buyer Tax Credit 2009/2010

Buyer Client Info – Federal Housing Tax Credit

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