Home Buyer Tax Credit Extended Through April 30, 2010

Congress voited to extend and expand the first-time homebuyer tax credit that was set to expire Nov. 30.  The details of the changes, which now opens up the tax credit to repeat home buyers, are outlined below.

Tax credit plan

According to the Senate Committee on Banking, Housing & Urban Affairs Web site, the homebuyer tax credit expansion measure includes these provisions:

• Extends the $8,000 first time Homebuyers Tax Credit and creates a new $6,500 tax credit for homeowners buying a new home from December 1, 2009 to April 30, 2010.

• Homebuyers with contracts as of April 30 qualify for the credit so long as they complete the transaction within 60 days.

• Available to homebuyers with incomes of up to $125,000 for a single return or $225,000 for a joint return.

• Not available for homes costing over $800,000.

• Homebuyers who already own a home are only eligible if the home they are leaving has been used as a principal residence for 5 years or more.

• Provides authority to the IRS to do greater oversight while processing the return and requires that the taxpayer claiming the credit be 18 or older.

• Members of the military, military intelligence and foreign service who are on qualified extended official duty are not subject to the recapture fee and individuals who have been deployed overseas for 90 days or more in 2008 or 2009 can claim the credit through April 30, 2011.

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