Biden $15,000 Home Buyer Credit?
President Biden’s housing agenda includes a proposal for a $15,000 first-time homebuyer tax credit. This is similar to the home credit provided over 10 years ago under President Obama (details below).
The difference is that this credit is to help American’s deal with home affordability vs the original credit was to rescue the American housing market.
It is still to be seen whether that full amount can make it through the legislative process in Congress, but with Democrats now controlling the House and Senate, the odds of some form of homebuyer tax credit are much better than a few months ago.
I will monitor the progression of this credit and will update as more information comes to hand. You can stay connected via the following options:
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2010-11 Home Buyer Credit Under President Obama
Approved! First-time home buyers now have until Sept. 30 2010 to close on their home purchases and qualify for the $8,000/$6500 tax credit under a new extension bill passed by Congress and signed into law by President Obama.
The home buyer credit, extended and expanded over the last 3 years is set to expire at the end of this month with Congress still unable to approve the extension as part of HR 4213 (see previous update below).
However, recently released data for May 2010 shows worrying trends of sharply declining sales of existing and new homes. Further, inventory data and foreclosure activity have not shown any signs of improvement.
All this suggests the expiration of the home buyer credit may have more of an impact than people thought.
This has prompted House members to take more action with the stalling of the HR 4213 bill in Congress (due to other provisions in it). As such a new bill – H.R 5623 – was introduced and approved by Congress and the President to extend the $8000/$6500 home buyer credit. Here is a summary of the bill:
H.R. 5623 – Home buyers Assistance and Improvement Act of 2010. Among other items, this bill would extend the home buyer tax credit of up to $8,000 for the purchase of a principal residence before October 1, 2010. The
current benefits apply to cover buyers who enter into contracts before April 30 and close by June 30. This bill extends the closing date to September 30, 2010.
The bill would provide any home buyer who entered into a contract on a home by April 30, 2010, but has been unable to go to closing within the required 60 days, an additional 90 days to close and qualify for the credit. This provision is estimated to cost $140 million
The approval of this bill would be great news for many home buyers who signed a purchase agreement/contract prior to April 30th but are having difficulty closing before June 30th. One thing to clarify – this bill does not extend the deadline for home buyers to sign a contract for a home and hence qualify for the tax credit (still April 30th); rather it extends the deadline for closing the transaction, from June 30 to Sept.30.
The National Association of Realtors estimates that this new extension will help about 180,000 home buyers who already signed purchase agreements and were likely to miss the Wednesday deadline.
The IRS has also released more details on the approved extension and required documentation:
To avoid refund delays, those who entered into a purchase contract on or before April 30, but closed after that date, should attach to their return a copy of the pages from the signed contract showing all parties’ names and signatures if required by local law, the property address, the purchase price, and the date of the contract.
Besides filling out Form 5405, First-Time Home buyer Credit and Repayment of the Credit, all eligible home buyers must also include with their tax return one of the following documents:
- A copy of the settlement statement showing all parties’ names and signatures if required by local law, property address, sales price, and date of purchase. Normally, this is the properly executed Form HUD-1, Settlement Statement.
- For mobile home purchasers who are unable to get a settlement statement, a copy of the executed retail sales contract showing all parties’ names and signatures, property address, purchase price and date of purchase.
- For a newly constructed home where a settlement statement is not available, a copy of the certificate of occupancy showing the owner’s name, property address and date of the certificate.
- Existing Home Buyers who qualify for this credit must must show that they lived in their old homes for a five-consecutive-year period during the eight-year period ending on the purchase date of the new home. This can be done by providing Mortgage interest statements, Property tax records or Homeowner’s insurance records
There are three options for claiming the credit on a qualifying 2010 purchase:
- If a 2009 return has not yet been filed, claim it on Form 1040 for tax-year 2009. Though these returns cannot be filed electronically, taxpayers can still use IRS Free File to prepare their return. The returns must be printed out and sent to the IRS, along with all required documentation. The IRS urges taxpayers claiming refunds to choose direct deposit.
- If a 2009 return has already been filed, claim it on an amended return using Form 1040X.
- Whether or not a 2009 return has been filed, wait until next year and claim it on a 2010 Form 1040.
[Update June 2010] Possible September 2010 Extension to Home Buyer Credit June 30 2010 Tax Credit Deadline. The U.S. Senate has approved a provision as part of the American Jobs and Closing Tax Loopholes Act (HR 4213) to extend the closing date for claiming the credit to September 30th. The Senate and House still have to approve HR4213 and all it’s other provisions, before the credit extension is passed. This is all expected to happen by before the Congressional summer recess.
Construction crews are working around the clock to meet tight deadlines to finish houses by the end of June so purchasers can get a federal home buyer tax credit of as much as $8,000. Home buyers are similarly anxious to get settlement on an existing house or the keys to the new home before the credit expiry date. To qualify, home buyers had to sign a contract by April 30 (intention to buy) and must complete the transaction by July 1st (June 30 is the last eligible day). To complete a newly constructed home sale, builders in most of the U.S. are required to have a certificate of occupancy from local officials attesting the house is finished or at least conforms to building codes. Mortgage lenders usually require the document before closing on a loan.
With all the hoopla around claiming the credit and a strong push from various realtor groups, Senate Majority Leader Harry Reid proposed a three-month deadline extension as part of the HR4213 jobs and tax extender act, amid concern that a rush of buyers created too big of a backlog. New-home contracts rose 30 percent in March and 15 percent in April, the biggest two-month gain in records dating to 1963, according to the Commerce Department. About a third of the April signings were for homes under construction, and a quarter were for those that weren’t started. The National Association of Realtors asked members of Congress to consider extending the tax credit deadline to allow people more time to complete sales, said Lucien Salvant, head of public affairs for the Chicago-based trade group. Reid, a Nevada Democrat whose state has been among the nation’s worst-hit housing markets, proposed moving the date to Sept. 30 2010.
One thing to clarify based on some reader questions: This amendment does not extend the deadline for home buyers to qualify for the tax credit; it extends the deadline for closing the transaction, from June 30 to Sept.30. Since these applications were already in the pipeline and figured into the program’s cost, the extension of the closing deadline should only incur minimal government costs.
New-home sales in March and April were concentrated in houses costing less than $300,000, signaling a rise in first- time buyers seeking the tax credit. The maximum benefit of $8,000 is reserved for people who have never owned property, while current homeowners can qualify for as much as $6,500 (see qualification details in previous updates below).
“The bulk of the delays are coming from people doing short sales, but we’re also seeing people having problems closing on homes they’re having built,” said Salvant. Short sales are transactions in which a bank accepts less than the balance owed on a property.
Other Home Buyer Credits still available like California Credit and 2011 Extension for Military home buyers.
In California, the federal tax benefit has been eclipsed by a $10,000 state tax credit for real estate purchased between May 1 and the end of the year. The credit applies to people who buy a new home and first-time home buyers who purchase either a new or existing property. Florida and other hard hit states also have home buyer assistance programs.
Similarly, the home buyer credit has also been extended for members of the Armed Forces and certain federal employees serving outside the U.S. have an extra year to buy a principal residence in the U.S. and still qualify for the home buyer credit. An eligible taxpayer must buy or enter into a binding contract to buy a home by April 30, 2011, and settle on the purchase by June 30, 2011.
[Mar 2010] With the deadline looming for the home buyer credit (see details below), many readers have asked if there is any update on a further extension of this popular tax credit. Recent housing data suggests that the housing market is still struggling with pending home sales dropping nearly 8 percent . The drop in pending (contract) home sales and unexpected declines in purchases of new and existing homes last month, adds to evidence the housing market, at the center of the worst recession since the 1930s, is still struggling to rebound. Further, the government has been forced to roll out new measures to help struggling homeowners facing foreclosure. So the question a number of realtors, housing industry members and would be home buyers are asking is that will the home buyer credit be extended again past summer?
Undoubtedly there is significant negative sentiment towards the home buyer credit, particularly from those home buyers who could not take advantage of previous versions with lower income limits; and from most conservative groups and fiscally focused politicians who want the home buyer tax credit to expire as planned. However, in addition to allaying the weakness in the housing market, extending the home buyer credit again could be a smart political move in an election year. Lawmakers, now more than ever, are looking for any successful mortgage and/or housing-related program that they can stand behind.
Besides the Fed’s mortgage-backed securities (MBS) purchase program, the home buyer tax credit has been touted by some as an extraordinary success. Such, “success” can provide the necessary political cover to advocate extending the credit, especially since the simple fact is that it if doesn’t work — that is, if it’s not being utilized — that it costs nothing. Deficit issues and the concept of whether we’re rewarding those who might have bought anyway will take a back seat. Keeping home sales going promotes home price stability, and that makes for less-grumpy voters as election time rolls around.
As of yet, there are only a few official rumblings about further extending the home buyer credit for new and existing home buyers. However, if the housing market and political climate continues to deteriorate I would not be surprised to see the credit extended again (albeit with slightly different conditions) to at least the end of the year.
One thing is for sure, over the next couple of months, especially with health care reform passing and taking a back seat, we are going to hear a great deal about the first time home buyer tax credit extension. It will be very interesting to see what Washington has to say about the current state of the housing market and the possibility of an extension to this tax credit.
[Update Dec 2009] The IRS has recently released more information on the extended and expanded first-time home buyer credit. I have covered a number of the details in the previous update below, but some of the following key provisions are useful for those planning to claim the credit in next year’s tax return:
1. The Worker, Homeownership, and Business Assistance Act of 2009 extends the deadline for qualifying home purchases from Nov. 30, 2009, to April 30, 2010. Additionally, if a buyer enters into a binding contract by April 30, 2010, the buyer has until June 30, 2010, to settle on the purchase.
2. The maximum credit amount remains at $8,000 for a first-time homebuyer – that is, a buyer who has not owned a primary residence during the three years up to the date of purchase. The new law also provides a “long-time resident” credit of up to $6,500 to others who do not qualify as “first-time homebuyers.” To qualify this way, a buyer must have owned and used the same home as a principal or primary residence for at least five consecutive years of the eight-year period ending on the date of purchase of a new home as a primary residence.
3. The new law raises the income limits for people who purchase homes after Nov. 6. The full credit will be available to taxpayers with modified adjusted gross incomes (MAGI) up to $125,000, or $225,000 for joint filers. Those with MAGI between $125,000 and $145,000, or $225,000 and $245,000 for joint filers, are eligible for a reduced credit. Those with higher incomes do not qualify. For homes purchased prior to Nov. 7, 2009, existing MAGI limits remain in place. The full credit is available to taxpayers with MAGI up to $75,000, or $150,000 for joint filers. Those with MAGI between $75,000 and $95,000, or $150,000 and $170,000 for joint filers, are eligible for a reduced credit. Th
ose with higher incomes do not qualify.
4. For all qualifying purchases in 2010, taxpayers have the option of claiming the credit on either their 2009 or 2010 tax returns.
5. A new version of Form 5405, First-Time Homebuyer Credit, will be available in the next few weeks. A taxpayer who purchases a home after Nov. 6 must use this new version of the form to claim the credit. Likewise, taxpayers claiming the credit on their 2009 returns, no matter when the house was purchased, must also use the new version of Form 5405. Taxpayers who claim the credit on their 2009 tax return will not be able to file electronically but instead will need to file a paper return. A taxpayer who purchased a home on or before Nov. 6 and chooses to claim the credit on an original or amended 2008 return may continue to use the current version of Form 5405.
Several new restrictions on purchases that occur after Nov. 6 go into effect with the new law:
• Dependents are not eligible to claim the credit.
• No credit is available if the purchase price of a home is more than $800,000.
• A purchaser must be at least 18 years of age on the date of purchase.
Members of the Armed Forces and certain federal employees serving outside the U.S. have an extra year to buy a principal residence in the U.S. and still qualify for the credit. An eligible taxpayer must buy or enter into a binding contract to buy a home by April 30, 2011, and settle on the purchase by June 30, 2011.
[Update Nov 2009] Following Congress approval, President Obama has signed off on the bill approving an extension of the $8,000 new home buyer tax credit until April 30th 2010 (with a phase-out by year end). Unfortunately new provisions in the extension are NOT retroactive. Here is a summary of the new and updated provisions and their impact on you if you have or are planning to buy a house:
– First-time home buyers who bought after January 1, 2009 (original date of credit term) and close before April 1 2010, would get the full $8,000. For homes purchased after April 1st 2010 to December 31st 2010 the credit is still available, but it’s value would be reduced by $2,000 in each successive quarter until expiry at the end of 2010.
– The approved extension would extend the credit, due to expire Nov. 30, to home purchases under contract by April 30, 2010, with borrowers allowed another 60 days to close the sale.
– Income qualification limits: The home buyers’ credit would be available to individuals earning up to $125,000, or $250,000 for couples, up from $75,000 for individuals and $150,000 for couples under the original rules. However the higher income limits are not retroactive, and are only applicable for home buyers who purchase a home after Nov. 6, 2009. The existing income (MAGI) limits still apply to purchases on or before Nov. 6, 2009
– *NEW* Current Homeowners looking for a new home could also qualify for a $6,500 credit if they have lived in their existing primary residence for at least five years. However they must have purchased the new home after Nov. 6th 2009 to qualify for this tax credit.
– Claiming the new home buyer credit: Unless you have already claimed it, the credit can now only be claimed when filing next year’s tax return (in 2010) by using Form 5405. For qualifying purchases in 2010, taxpayers have the option of claiming the credit on either their 2009 or 2010 return. If you and your spouse claim the credit on a joint return (both of you must meet the income and past ownership criteria to qualify), each spouse is treated as having been allowed half of the credit for purposes of repaying the credit. So the total amount claimable is still only $8000 (up to April 30th 2010).
– The $8000 credit can still be used towards the down payment of a house bought in the credit qualifying period. You need to work with your lender to take advantage of this provision.
– Tax Credit Exclusions: Homes that cost more than $800,000 aren’t eligible for the credit and you must be over 18 years old to claim the credit. Those who sell their new home or stop using it as their main residence within three years would have to repay the credit. You cannot claim the credit if acquired your home by gift or inheritance OR if you acquired your home from a related person
– If two or more unmarried individuals buy a main home, they can allocate the credit among the individual owners using any reasonable method. The total amount allocated cannot exceed the smaller of $8,000 or 10% of the purchase price. Note: A reasonable method is any method that does not allocate all or a part of the credit to a co-owner who is not eligible to claim that part of the credit (I would go with 50/50 as a reasonable method if one person is not eligible for the credit)
– The purchase date is how you decide which credit you are eligible for. Only homes purchase from Jan 1 2009 to April 1st 2010 are eligible for the fully refundable $8000 credit. If you constructed your main home, you are treated as having purchased it on the date you first occupied it.
[Update Oct 2009] Senate votes 98-0 to Extend and Gradually Reduce Home Buyer Credit in 2010
Senate leaders have overwhelmingly agreed to extend and gradually reduce the $8,000 first home buyer tax credit through 2010. Deliberations will now move to the House of Representatives. Senate Majority Leader Harry Reid of Nevada and Senate Finance Committee Chairman Max Baucus of Montana, both Democrats, may seek to add the home
buyers extension to legislation extending unemployment benefits that may be debated as early as this week, according to Regan Lachapelle, an aide to Reid. More than 1.2 million borrowers through Oct. 9 have claimed almost $8.5 billion of the $13.6 billion set aside for “first-time” home buyer tax credits this year. The program is aimed at easing the worst housing slump since the Great Depression and has been credited with boosting the economy and stock markets over summer. See the previous update below for the various bills under consideration to extend this tax credit.
Lawmakers are under pressure from real estate agents, mortgage brokers and homebuilders to extend the $8,000 credit before it expires Nov. 30. However, they are also facing pressure from governance groups and recent IRS reports claiming widespread fraud around claims for this lucrative credit. The Internal Revenue Service has identified 73,799 claims totaling almost $504 million that may not be from first-time homebuyers. They also found that 582 taxpayers under 18 years old and ineligible to buy a home claimed almost $4 million in credits. Children as young as 4 years old received the credit, Treasury Inspector General for Tax Administration J. Russell George told a House panel.
The bill to extend the credit contains the following provisions:
– First-time home buyers who close before April 1 would get the full $8,000, and the credit’s value would be reduced by $2,000 in each successive quarter until expiring at the end of the year.
– The plan would extend the credit, due to expire Nov. 30, to home purchases under contract by April 30, 2010, with borrowers allowed another 60 days to close the sale, according to a person familiar with the details of the agreement.
– Existing Homeowners could qualify for a $6,500 credit if they have lived in their primary residence for five years
– The homebuyers’ credit would be available to individuals earning up to $125,000, or $250,000 for couples, up from $75,000 for individuals and $150,000 for couples under the current law.
“Relative to current law, this is better. But it’s worse than people are expecting,” said Tom Gallagher, head of policy research in the Washington offices of International Strategy and Investment Group, an independent research firm. “This is a four-month extension and a nine-month phase-out.”
The proposal was intended to counter one by Senate Banking Committee Chairman Christopher Dodd, a Connecticut Democrat, and Senator Johnny Isakson, a Georgia Republican and former real estate agent, to extend the full $8,000 credit through next June and to expand it to all couples earning $300,000 or less. The Baucus-Reid proposal would continue limiting the benefit to first-time homebuyers, Lachapelle said.
The terms for extending the homebuyer tax credit are still being negotiated. House Speaker Nancy Pelosi, a California Democrat, is waiting to see the final Senate agreement before deciding whether to support it. “Generally, we do support extending it,” Pelosi spokesman Nedeam Elshami said. “But it’s premature to say anything until we see what action the Senate takes.”
[Updated Oct 1st] Given it’s success in stabilizing the US housing market, Congress is considering extending the first-time homebuyer tax credit for up to a year to further boost the real estate market. The $8,000 first-time homebuyer tax credit – covered in detail here – runs through Nov. 30. Some lawmakers also want to extend the amount of the credit to $15,000 and want the extension broadened to include all homebuyers.
The $8,000 tax credit (funded under Obama’s 2009 economic stimulus program) to qualified first-time buyers has directly resulted in 357,000 home sales between Feb. 17 and Sept. 15, data released yesterday show. Thus far, 1.4 million taxpayers have claimed the credits, the IRS reported. Nearly 1 in 5, or 18 percent, of prospective first-time homebuyers who participated in a Zillow survey said extending the tax credit would be the primary influence on their decision to buy a home before the end of 2010.
Realtors, bankers and homebuilders have joined in the push, starting a campaign that encourages Congress to extend the program for one year with the tag line: “Don’t Let America’s Real Estate Recovery Expire.”
Executives including Fannie Mae’s Michael Williams and Hyperion Partners LP’s Lewis Ranieri have attributed improvements in home sales and prices to the credit, and Isakson said he is worried the market may suffer without it.
White House spokesman Robert Gibbs told reporters today that President Barack Obama’s economic team is looking at the tax credit and “evaluating the impact” on new home sales.
40 thoughts on “Claiming The $15,000 First-Time Homebuyer Tax Credit”
I was able to claim and got the tax credit. Do we have to pay it back?
if you got the fist time home owner loan and you ended up having to bankrupt your home, what does this do? Never had any issues when filing taxes, they have taking the $500 a year to repay. But this year me and my ex husband has divorced and did not claim taxes together and we are having e biggest issue of getting our refund due t the bill passed by Congress. Any suggestions?
hi,i purchased my house in march 2011,i want to know if i qualify for the stimulus.
No. Unless you are in the armed forces.
my wife and i had a constuction loan in 2008, refinanced on jan 22nd 2009 then moved in when house was done.we took the 2008 home buyers credit then,were we misled were we able to get the 8.000 because we refide on 22nd 2009. please can anyone give us a real answer to this madness.thanks
I have also purchased a home in 2005. Can I receive a credit for that?
I puichased a home in october 2017. I am eligible for first timehomeowner credit ot has the program been discontinued??? My CPA TELLS ME THE PROGRAM WAS TERMINATED
I am a first time home buyer. We closed on Oct 8 2010. Our lender did not tell us that this was Sept. 30th was the last day to claim $8000 nor did he ask us if we wanted to take advantage of the first time home buyer through our lender. What are my options to be able to claim this on taxes or with my lender?
my wife and I bought a new home Texas in 12/2009 and received the credit as first-time homebuyers.
We have since seperated. I vacated the home in 11/2010. There are no legal seperation papers at this time, although divorce is simply awaiting the proper filings. no Children are involved.
My wife intends to keep the home. It is in both names, with hers listed first
1) Since I myself did not fulfil the requirements of leagth of residence, will this have a consequense to me?
2) Will that answer change if a divorce should be finalized, particularly with 100% of the home to her (as is our intent) ?
3) If she should enter into a new mortgage (To simplify the title into her name alone) would that have consequenses for either of us if done before the “residency” time had expired?
Thank you for any guidance you can ofer!
I have a similar situation. Did you find an answer?
I am a first time buyer. I am retired military. Do I qualify for the $8,000 tax credit?
Hello, My Husband and I been in our home for 13 years. We would like information on how to apply for the 6,500 tax credit , there has been rumors we do not qualify. Please give us a respond at your earliest convenience September 30 three weeks away.
Is there a time frame for how long a person has to keep possession of the home so that they don’t have to pay back the tax credit? Can a person who gets married or has to move from the house because of their job then use the house that they got the rebate on as rental property or does it have to be their primary residence? Thank-you.
Andy – Are they going to create another tax credit for those who were not able to enter into a contract by APRIL 30, 2010. I am a first-time homebuyer and would love to benefit from a credit also!!!
Not that I have heard of. But I will post an update if they do.
I saw state of union over the weekend and HUD Secretary Shaun Donovan said that yet another home buyer tax credit could be possible. This one could involve not just first time/move-up buyers, but a credit for buyers purchasing foreclosed properties or short sales (when the bank allows you to buy a home for less than the value of the outstanding mortgage).
Still early days, but given the success of this credit I could see one targeting foreclosed properties as a real shot. Particularly if August numbers are bad.
HOW ABOUT OBAMA DOING SOMETHING FOR THE ONES THAT PURCHASED A HOME IN 2009 AND MISSED THE HOME BUYERS TAX CREDIT BY 2 MONTHS. WE PURCHASED OUR HOME IN SEPT. AND THOUGHT WE QUALIFIED FOR THE $6,500.00 TAX CREDIT DUE TO ALL THE HYPE LAST YEAR AND FALSE ADVERTISING IN OUR COMMUNITY. FOUND OUT BY THE IRS WE DIDN,T QUALIFY. JACKSON
my wife and i purchaced my mother in laws house in March 2010, after selling our house of 16 years checking the IRS from it states we can not get the $6,500.00 credit. is this correct still and if so is there anything we can do to get it? should i take the risk on my taxes since we have differant names? the only benifit we did get was a gift of equity.
EMP – It seems like you qualify on the time period criteria. However what reason did the IRS give for saying you would not be eligible? Please see the post for the various qualification criteria to ensure you meet them all (eg incoome, primary residence etc).
Andy, see section 1 E
http://www.irs.gov/pub/irs-pdf/f5405.pdf Am i missing somthing? we do fit all other criteria should i take the risk on my taxes since we have differant names?
my wife and i purchaced my mother in laws house in March 2010, after selling our house of 16 years checking the IRS from it states we can not get the $6,500.00 credit. is this correct still and if so is there anything we can do to get it? should i take the risk on my taxes since we have differant names? the only benifit we did get was a gift of equity. we do fit all other criteria see section 1 E is there some way i can get the 6500 credit????
Actually, I just re-read 5405 and you cannot claim the credit since you are buying from a family member (your wife’s mother). If you file a joint return with your wife, then this could be picked up. If you do file with different names, you may actually get the credit, but could be caught out in an Audit. So the question you have to ask yourself is 6500 worth dealing with a potential audit? Your call.
Hi my name is Julie . Let me explain my situation to you. Here goes. Last year when I filed my taxes. I applied for the 7,500 house credit. I was purchasing a home & closing soon . I went online to Turbo tax & all it asked for was the Address,date & Amount of the home. I got the &7,500 paid off most of my credit issues except the medical as i was told not to worry about them . Well to make a long story short. The house fell thru 3days before closing & I have DESPERATLEY tried to get reapproved before June 30th of 2010. I was just going to file an amendmant and change the amount ,date and Address. Can I still get a home if I get into a contract and close by Oct 1st. I dont need to qualify for it i allready got it. But i did file for an extention for my taxes to do the amendment if I can?
I recently purchased a house with my husband in June ’09. We received the 8,000 credit because we were first time home buyers. Well, we are in the process of getting a divorce. That means if we sell the house we have to pay the 8,000 back, right? If I buy another house, would I qualify for the 8,000 again? The mortgage is only in his name, so if I decide to keep the house, I have to refinance it. Will I have to pay the 8,000 because I refinanced?
You would be liable for $4000 of the credit unfortunately. Also you would not get another credit since the deadline for the credit qualification has already passed.
My wife and I owned our previous house for 25 years. We sold it Sept. 20, 2009 and bought another house Sept. 18, 2009. Do we qualify for the $6500.00 tax credit? Everything I am reading is so confusing. Thank you.
You may not qualify because the existing home buyer credit provisions only went into place after Nov 9. See this block in the article
“Current Homeowners looking for a replacement primary residence could also qualify for a $6,500 (up to $3,250 for a married individual filing separately) under the new “long-time resident” provision. They must have lived in the same principal residence for any five-consecutive year period during the eight-year period that ended on the date the replacement home is purchased. This new provision also only applies to homes purchased after Nov. 6th 2009. The IRS has stepped up compliance checks involving the home buyer credit for those with past homes and they must provide a mortgage Interest Statement, Property tax records or Homeowner’s insurance records, to prove compliance with past residency criteria.”
I bought retirement home on the coast and selling my home inland. I purchaced new one Feb 2010 and filed for check in May(still waiting) but now we are going to sell that one and get another one in the same 55 & older Park. I guess I will need to send the check back if I ever get it.
Yes – if you meet all the requirements you can still claim the credit. You would need to file the tax return to claim it, but it is a refundable credit. That means that you can get a refund even though you pay no tax and have no payments against tax. You also should consult a tax advisor and see if you should have been filing even if your income is below the filing requirement in order to claim other refundable credits that may be available to you. In addition, each state has its own requirements so you might need to file a state return even if you are under the Federal filing limit.
Open Congress is reporting that Senate Democrats are trying to pass a bill (H.R. 4213) combining an unemployment insurance extension, stimulative tax credits, state aid for Medicaid, and tax hikes on hedge funds and oil companies. They need at least two Republican votes in order to break a filibuster, but, so far, no Republicans are going along with them.
CongressDaily ($) reports this morning that the Dems are changing up their strategy. Rather than trying to strike a deal with the GOP, they are going to work directly with the infamous fourth branch of government — corporate lobbyists:
The Homebuyer’s Tax Credit has NOT been extended or approved. It is before Congress now. It’s too confusing to people who have a hard time understanding interest rates and closing costs to say it has been approved by one chamber – all that really matters is when it has the signature of the president. It doesn’t.
The whole purpose of the tax credit was to give the home buyers money that they would pump right back into the economy. Thus, it’s not just the banks getting rich off of someone buying a house. I just purchased my house back in March and since then I have made countless trips to Lowes, Ikea, etc. The tax credit wasn’t meant to be something that you just put away. It is to stimulate the economy. The only way for the economy to bounce back is for people to spend money. Economics 101. So people buy a house, then they may want to paint a room or two, buy a couch, get that big screen tv, do some landscaping… Not only is it good for other stores, but also when people put that money back into the house, it increases the value of the house! I had some money saved up already, but with a chunk of the tax credit money, I’ve put about 9k into my house. It just appraised for almost 50k more than what it was at closing! People gripe about the tax credit and how we will all have to pay for it and blah blah blah. There were the people that were irresponsible with their money that got us into this crisis. And then there were the tight wods that didn’t spend a DIME that also got us here. We live in a capitilist country. Gotta spend money to make money.
Homebuilders have pulled back following the expiration of the federal first-time homebuyer tax credit. Housing starts in May fell 10% compared to April, to an annual rate of 593,000, a steeper drop than expected. Data released this morning by the Census Bureau also showed new permits for residential construction falling 5.9% below April’s rate. Both starts and permits rose year-over-year, but are still very low by historical standards.
Is there any doubt the extenstion will be approved?
ME AND MY WIFE ARE FIRST TIME HOMEBUYER, IF WE WILL HAVE A HOUSE THIS JUNE 2010 THROUGH DECEMBER 2010 ARE WE HAVING A TAX CREDIT FROM THE GOVERMENT?
If you and your wife entered into escrow BEFORE April 30, 2010, then yes, you qualify for the first-time homybuyer’s tax credit of $8000. If you closed escrow by June 30, 2010 then you will definitely get the $8k. This article is about the extension to close escrow by Sept 30th, 2010 for those homebuyers that have not closed the deal yet.
i purchased my home in april 2008.the gov. at that time offered a 7500 no intrest loan as opposed to the 8000 credit that obama put in a few months later. anyone know if the loan was restructered to a credit. there was some talk of that the new bill was passed. i think there is skunk in the woodpile here. everyone should get the same deal. this offer was to help ignite the economy why do the first wave have to pay it back?
Unfortunately the 3 incarnations of the home buyer credit that are detailed in the post all had their own rules/criteria and are not retroactive. I agree it is unfair and was personally affected. But that’s the way the dice rolls.
What about the people that bought 3 or 4 years ago that get no credit or interest free loan? LIFE IS UNFAIR. you got something, so be grateful instead of always wanting more.
Will the activists have something to say? the hand that rocks the cradle rules the world,
Extending the home buyer tax credit until January 1st 2011 will boost declining new and used home sales.
Releasing credit score restrictions will boost consumers ability to purchase cars.
Fico scoring system should be reconstructed because it works with coorperations to force fixed and middle income people to pay the highest interest rates.
All of the above will increase consumer spending. Thats my 3cents worth.