Wednesday, 18 November 2009
Congress has extended and expanded the homebuyer tax credit. The modifications become effective when President Obama signs the bill. All changes made to the current credit become effective on that date as well.
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FEATURE
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December 1 – April 30, 2010
Rules as enacted November 2009
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First-time buyer
Amount of Credit
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$8000 ($4000 married filing separate)
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First-time buyer
Definition of Eligibility
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May not have had an interest in a principal residence for 3 years prior to purchase
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Current Homeowner-
Amount of Credit
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$6500 ($3250 married filing separate)
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Effective Date –
Current Owner
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Date of Enactment
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Current Homeowner – Definition of Eligibility
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Must have used the home sold or being sold as a principal residence consecutively for 5 of the previous 8 years
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Termination of Credit
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Purchases after April 30, 2010
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Binding Contract Rule
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So 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.
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Income Limits
(Note: Increase income limits are effective as of date of enactment of bill)
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$125,000 – single
$225,000 – married
Additional $20,000 phase out
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Limitation on Cost of Purchased Home
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$800,000 Effective Date of Enactment
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Purchased by a Dependent
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Ineligible Effective Date of Enactment
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Anti-fraud Rule
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Purchaser must attach documentation of purchase to tax return
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