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Congress Expands Home-buyer Tax Credit*
HOW THE HOMEBUYER TAX CREDIT WOULD WORK
Tax credit: 10% of the purchase price of a primary residence, up
to a maximum of $8,000 for first-time homebuyers and $6,500 for
repeat buyers. First-time homebuyers are defined as people who
have not owned a home in the previous three years. Repeat
buyers must have owned their current home at least five years.
The credit cannot be used for houses costing more than $800,000.
Deadline for qualifying: Purchase agreements must be signed by
April 30, 2010, and closings must be final by June 30.
Military deadline: The deadline is extended by a year for members
of the military who have served outside the U.S. for at least 90 days
from Jan. 1, 2009, to May 1, 2010.
Income limits: Individuals with annual incomes up to $125,000
and joint filers with incomes up to $225,000 qualify for the full credit.
Individuals with incomes up to $145,000 and joint filers with
incomes up to $245,000 qualifyfor reduced credits.
How to apply: Taxpayers can claim the credit on their federal
income tax returns. If the credit exceeds their tax bill, the
government will issue a payment. Taxpayers who want immediate
refunds can amend their tax returns for 2008 to claim the credit.
*USA Today - Source: Joint Committee on Taxation
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