President Barack Obama signed homebuyer tax credit extension!

RISMEDIA, November 9, 2009—President Barack Obama has approved the first-time homebuyer tax credit extension which will extend the tax credit until April 30, 2010.

The extension is part of a $24 billion economic stimulus bill that will extend the $8,000 tax credit for homebuyers who are purchasing their first home from the current November 30 deadline and expands the program to offer a credit of $6,500 to homeowners who have lived in their current home for at least five years and are seeking to relocateRead more: http://rismedia.com/2009-11-08/obama-signs-homebuyer-tax-credit-extension/#ixzz0WUokStTl

Who is Eligible

First-time homebuyers, who are defined as buyers who have not owned a principal residence during the three-year period prior to the purchase, may be eligible for up to an $8,000 tax credit or 10% of the purchase price of the home

Existing homeowners, who have been residing in their principal residence for five consecutive years out of the last eight and are purchasing a home to be their principal residence, will be eligible for up to a $6,500 tax credit.

You must file taxes to be eligible to participate in this program

Income Limits

• Homebuyers who file as single or head-of-household taxpayers can claim the full credit ($8,000 for first-time buyers and $6,500 for repeat buyers) if their modified adjusted gross income (MAGI) is less than $125,000.


• For married couples filing a joint return, the combined income limit is $225,000.


• Single or head-of-household taxpayers who earn between $125,000 and $145,000, and married couples who earn between $225,000 and $245,000 are eligible to receive a partial credit.

Effective Dates

• The eligibility period for the tax credit is for homes purchased (closed) after Nov. 6, 2009, and before May 1, 2010.


• Also, home purchases subject to a binding sales contract (Purchase Agreement) signed by April 30, 2010, will qualify for the tax credit provided closing occurs prior to July 1, 2010.

Types of Homes that Qualify

• All homes with a purchase price of less than $800,000 will qualify This includes new construction or resale single family homes, townhomes, or condominiums.


• The home must be used as the purchaser's principal residence. Note that purchases of vacation homes and rental properties do NOT qualify

Tax Credit is Refundable

• You may take the credit on your 2009 or 2010 tax returns.


• If the amount of income taxes you owe is less than the credit amount you qualify for, the government will send you a check for the difference


• Be sure to check with your tax advisor!!

FAQ's from National Asso of Realtors
http://tinyurl.com/y9492n4

The U.S. House Passes Homebuyer Tax Credit Extension

Yes, they can! Republicans and Democrats can agree on something!

As reported by DSNews http://www.dsnews.com/articles/house-passes-homebuyer-tax-credit-extension-2009-11-05

The U.S. House of Representatives decided Thursday to extend and expand the federal homebuyer tax credit. The legislation passed with a vote of 403 to 12.

It cleared the Senate Wednesday, with unanimous approval. President Obama is expected to pen his name to the bill and make it official.

The $8,000 tax incentive for first-time homebuyers, which had an expiration date of November 30, will be extended through April 30 of next year.

The tax break has been expanded to include a new category of buyers – those who have lived in their current home for at least five years, but want to purchase a new home as their primary residence. The credit amount for these buyers will begin on December 1 and is $6,500.

The April 30 deadline is the date by which buyers must have signed a purchase contract, eliminating the mad frenzy to eek closing out by the sunset date. Another 60-day window beyond the end of April is allowed to complete the closing of the deal.

The U.S. Senate voted Wednesday to extend homebuyer tax credit (98 to 0)

I guess Republicans and Democrats can agree on something....

http://www.dsnews.com/articles/senate-approves-homebuyer-tax-credit-extension-with-unanimous-vote-2009-11-04

The U.S. Senate voted Wednesday to extend and expand the popular first-time homebuyer tax credit. The measure cleared the chamber with a vote of 98 to 0.

It now goes to the House of Representatives for approval. According to a statement from House Majority Leader Steny H. Hoyer (D-Maryland), it will be brought “to the House floor for a vote as early as tomorrow [Thursday].”

The bill is widely expected to pass the House as well, and then needs only President Obama’s signature.
The $8,000 tax break for first-time buyers, which was set to expire at the end of this month, would continue until April 30, by which buyers would have to have signed a contractual purchase agreement, but not closed on the sale. Another 60-day cushion beyond the end of April would be allowed to complete the closing.

The measure removes the first-time-only stipulation, though, opening the benefit up to existing homeowners who’ve lived in their current residence for at least five years but want to relocate to a new primary residence.
The incentive amount for those buyers is $6,500.

The income limits for both first-time buyers and existing homeowners would be $125,000 for individuals and $225,000 for couples – up significantly from the current first-time buyer thresholds of $75,000 per individual and $150,000 per couple.

The tax break would only be offered on homes priced at $800,000 or less, and beneficiaries who sell the home or stop using it as their primary residence within three years would be required to repay the credit.

The housing tax credit expansion was appended to a larger bill that also included an extension of unemployment insurance benefits and provisions that allow companies to apply net operating losses to previous years’ numbers in order to reduce their business tax.

Last night, the US Senate Clears Homebuyer Tax Credit Extension... to Pass This Week

Key points:

First-time buyers tax credit deadline would be extended through April 30th.

A new $6,500 maximum credit for “move-up" homeowners who have lived in their current residence for 5 of the last 8 years.

Enjoy all the details below!

As reported by UPI - 11/3/2009
http://www.upi.com/Real-Estate/2009/11/03/Senate-Clears-Homebuyer-Tax-Credit-Extension-to-Pass-This-Week/3701257254252/

After two weeks of delay, the Senate last night cleared the way to pass a seven month extension and expansion of the tax credit for homebuyers. By an 85 to 2 roll call vote, the Senate voted to cut off debate on a package of measures that includes the homebuyer credit, making it virtually certain that the legislation will reach President Obama for his signature this week.

The homebuyer tax credit, due to expire in 28 days, would be extended through April 30 of next year. First-time buyers who are in process of making a purchased would not need to worry about qualifying for the $8,000 credit if they close after the November 30 deadline.

For the first time, the legislation cleared last night makes move-up buyers as well as first-time buyers would be eligible for a credit. The $8,000 maximum first-timer credit will continue and will now available to couples with income up to $225,000, a nearly $55,000 increase above the level in existing law. A new $6,500 maximum credit would also be available to move-up homeowners who have lived in their current residence for five of the prior eight years.

The tax credit has fired the housing market, driving existing home sales to the highest level in over two years. The National Association Realtors reported sales jumped 9.4 percent to a seasonally adjusted annual rate of 5.57 million units in September and are 9.2 percent higher than the 5.10 million-unit pace in September 2008.

Only two Republicans voted against the credit. One of them, Senator Kit Bond (R-Mo.), said, “We’re kidding ourselves if we think we can prevent more fraud, more taxpayer losses,” “The most effective means of preventing fraud is simply to not extend the credit.”

The legislation included provisions added to address complaints of fraud. The Internal Revenue Service is given greater authority to oversee the process to root out fraud, and provisions are added in response to past abuses of false sales or underage buyers. An investigation by the Treasury Department’s Inspector General for Tax Administration found that more than 580 children, some as young as four years old, had received $627,000 in first-time homebuyer credits. The IRS has identified 167 suspected criminal schemes and opened nearly 107,000 examinations of potential civil violations of the first-time homebuyer tax credit.

A number of economists have voiced concern about the $16.7 billion.cost of the credit and the wisdom of spending up to $400,000 per homebuyer to stimulate real estate sales. The White House has been lukewarm at best. However, it is virtually certain that the President will sign the legislative package, which contains an expansion of unemployment benefits as well as the tax changes.

The legislation cleared last night also contains a provision supported by the National Association of Home Builders. It helps larger companies strapped for cash with net operating losses this year or in 2008.

Ordinarily these companies can carry back these losses for only two years to qualify for a tax refund. The provision would make this process extends the carry-back to five years for either 2008 or 2009. The tax break will now apply to losses in either 2008 or 2009, and the income cap will come off.

A similar provision, applying just to 2008, was included in the president’s economic recovery bill last winter but limited to smaller companies to keep down the cost to the Treasury.

Both tax breaks - the homebuyer credit and the change to net operating loss - will be offset by tax changes affecting foreign tax credits, chiefly important to large multinational corporations, according to the Senate Finance Committee.