New $6,500.00 Homebuyer Tax Break for 2009, 2010
To state the obvious: In our current economy, things are tough. The government is making many cuts, gas prices are slowly on the rise again and loans are much harder to come by.
One of the most affected markets is the real estate market. If you’re a prospective new homebuyer this year, things may seem pretty bleak. Luckily for you, the government wants to give you a tax break.
Giving Credit Where it’s Due
You might already know of the $8,000 tax credit set up for first time homebuyers or for people who haven’t owned a primary residence in three years that was set to expire November 30th. Well first of all, this tax credit has been extended to April 30th! (the contract must be signed by April 30th, and the deal must be closed by June 30th). The income qualifications for the tax credit have also been widened so that more people qualify.
The New Deal of the New Deal
In addition to all this, there is also a $6,500 tax credit for those who have lived in home for at least five consecutive years of the last eight years and are looking to purchase a new house. For example, if you bought a house in 2004, lived there until 2009, rented that house out and purchased a new home, you would qualify for the new homebuyer’s tax credit.
However, if you bought a home in 2006 and today did the same thing as the above example, you wouldn’t qualify. And keep in mind that in the five consecutive years are not part of the last eight years, you won’t qualify.
This new tax credit is intended to give the real estate market the boost it’s been needing for a while now. One important thing to keep in mind is that these tax credits only apply to home purchases less than $800,000.
There are many places to learn more about the new homebuyer tax credit. One of them is TurboTax Online, a site that can answer just about any tax question you can think of, not to mention it’s nice place to do your taxes.
