$8,000 Tax Credit Extended (And EXPANDED) for DFW Residents

The $8,000 tax credit, which was scheduled to lapse on Dec. 1 of this month, was effectively extended through the end of June 2010.  This is great news for people who were rushing to find a good home in order to qualify!  Homebuyers must now sign a contract before April 30 and close on their home by June 30.  There were also some changes in regard to income limits.   Single buyers can now earn up to $125,000 and still get the full credit, while a married couple can earn $225,000.  Hooray!

But the government didn’t stop there.  Not even close.  The new bill even makes more homeowners eligible to claim the credit on their taxes.  First-time homebuyers (those who haven’t owned a a home in the past 3 years) still qualify for the existing credit of $8000, but now those who have owned (and lived in) a residence for at least 5 years can claim a credit in the amount of $6500!

“The new version of the tax credit has the potential to stimulate the housing market even more than the old version due to the fact that more people will qualify under the new rules,” said Gibran Nicholas, chairman of the CMPS Institute, an organization that certifies mortgage bankers and brokers.

You might be asking “how does this crazy tax credit work?”  Well, the tax credit is applied in relation to the taxes you actually owe. For example, if you owe $8750 in taxes and then apply your $8000 credit, your new tax bill will be reduced to only $750!  If you only owe $500 you will get a credit back in the amount of $7500.  It’s that easy.  As always, you can still amend your 2008 return and take the deduction in 2008, as long as you closed on a home before November 6, 2009.

ONE IMPORTANT THING TO CONSIDER:

If you purchase a home and take advantage of the tax credit, you can’t sell your home within the first 3 years of ownership without the entire amount of the tax credit being recaptured. This means you will be required to give that money back to the I.R.S.  So, if you take advantage of the tax credit, plan to stay put for 3 years.  After that you won’t owe anything!

As always, if you have any questions about the tax credit, don’t hesitate to CONTACT US and we will get back to you blazing fast!  You can’t even imagine how fast we will get back to you!  Just try it!  I dare you!

2 Comments for this entry

• 

  ReMortgage mikey

  March 30th, 2010 on 9:18 pm

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