Archive for Home Buyer Tax Credit
Home Buyer Tax Credit Being Extended?
Posted by: | CommentsHome buyers may get an extra three months to finish qualifying for federal tax incentives that boosted home sales this spring.
Senate Majority Leader Harry Reid, D-Nev., said Thursday he wants to give buyers until Sept. 30 to complete their purchases and qualify for tax credits of up to $8,000. Under the current terms, buyers had until April 30 to get a signed sales contract and until June 30 to complete the sale.
The proposal would only allow people who already have signed contracts to finish at the later date.
The National Association of Realtors estimates that about 180,000 buyers who already signed purchase agreements are likely to miss the deadline.
The tax credits have helped propel sales in Southwest Florida for the last several months, taking the levels of homes changing hands back to the boom times of mid-2005.
Sales have not declined in the Sarasota-Bradenton market for nearly a year. They were up 32 percent in April. In Charlotte County-North Port — which has not seen a drop since December 2008 — sales rose 6 percent last month, according to data from the Florida Association of Realtors.
Condominium sales also rose dramatically in April — up 70 percent in both Sarasota-Bradenton and Charlotte County-North Port.
Reid introduced the proposal as an amendment to a bill that would extend jobless benefits through the end of November. Joining him were Sen. Johnny Isakson, R-Ga., and Christopher Dodd, D-Conn.
The Senate is expected to take up the amendment next week. Senate Democratic leaders hope to finish work on the jobless benefits bill next week, but they have yet to secure enough votes.
Military Home Buyers Get Extended Tax Credit
Posted by: | CommentsJune 10, 2010–Military families seeking to buy a home can count on a little tax help. The Homebuyers Tax Credit, which provides eligible buyers with a tax credit of $8,000 for first time buyers and $6,500 for repeat home buyers, ended on April 30, 2010 for civilians. However, active duty military or those on extended overseas duty have until on or before April 30, 2011 to have a binding sales contract in place. The bill also exempts qualified service members on official extended duty from tax credit recapture rules.
“We honor those who serve our country and are glad that this bill acknowledges the unique circumstances they face,” said Benjamin Clark, 2010 President of NAEBA. ”This bill ensures that members of the military have equal opportunity to participate in the homebuyer tax credit and offers relief to struggling military families by making the mortgage payment tax deductible.”
The Worker, Homeownership, and Business Assistance Act of 2009 provides a tax credit of up to $8,000 for qualified first-time home buyers purchasing a principal residence and a tax credit of up to $6,500 for repeat home buyers who have owned a home for five consecutive years out of the prior eight years. The tax credit is available for eligible purchasers who have a binding sales contract in place by April 30, 2010, and close by June 30, 2010. However, realizing that members of the military, the Foreign Service and Intelligence Community have unique circumstances the bill has special provisions for this group:
– Tax credit extended for one year for military personnel serving outside the United States for at least 90 days during the period beginning December 31, 2008 and ending May 1, 2010.
– Eliminates the 36-month recapture requirement for military personnel, including members of the Foreign Service and intelligence community, forced to sell or move from a tax credit home as a result of an official extended duty of service.
Visit www.irs.gov for more information on qualifying and claiming the tax credit.
Extend Tax Credit Timeline?
Posted by: | CommentsBy Nick Timiraos and Dawn Wotapka (Wall Street Journal)
The real-estate lobby wants Congress to extend the amount of time that potential home buyers have to complete transactions that qualify for the $8,000 federal home-buyer tax credit.
To qualify for the tax credit, buyers had to sign purchase agreements by April 30. Those buyers have until the end of June to close on those sales, and anything that closes after that wouldn’t get the tax credit.
The problem, says the National Association of Realtors, is that many of those signed contracts are on foreclosures and short sales, where the lender allows the house to sell for less than the amount owed to the bank. Those transactions take longer than normal to process, and there’s some concern that many sales may not actually close in time.
“There could be a sizable number of home buyers who responded to tax credit incentives, but may encounter problems,” said Lawrence Yun, the trade group’s chief economist, in Wednesday’s report that showed a 6% surge in pending home sales during April.
The NAR and its members are asking Congress for flexibility with the June 30 deadline, but it is unclear when—or even if—something would happen. (The National Association of Home Builders says it is not asking for a deadline tweak.) Congress would have to pass such a measure quickly, which is no easy task. One possibility would be to attach the extension to a piece of legislation that’s already winding its way through both chambers.
Last week, Congress went into the Memorial Day recess without completing a bill to authorize new funding for the USDA’s rural development loan program, which lets some home buyers tap 100% financing. Supporters of that program have been pushing for more funds for several weeks.
Without a last-minute reprieve, all would-be buyers can do is push for the different parties to close the deal in time.
But don’t spend that downtime shopping. Incurring additional debt can raise red flags with the lender, possibly derailing a deal at the last minute.
“We do see it happen where [buyers] qualify and then they go out and buy a new car,” says Brent Anderson, vice president of investor relations with Meritage Homes. “All of a sudden they don’t qualify anymore.”
Home Buyer Tax Credit Expanded
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Today, the U. S. Senate voted overwhelmingly to expand a first-time homebuyer tax credit to include a far larger pool of people entering the dormant housing market. This legislation now goes to the U. S. House of Representatives, which is expected to quickly approve the measure and send it over to the President for his signature.
The $8,000 tax credit for first-time homebuyers, enacted as part of the stimulus package last February, and set to expire on November 30th, would be extended and expanded to include a $6,500 credit for people who have lived in their current residence for 5 of the prior 8 years. Move-up buyers don’t have to sell their current home to qualify for the new $6,500 credit, but the money cannot be used to purchase a vacation home – it’s only for a primary residence! Homes must cost less than $800,000 to qualify for this program.
The legislation would extend the $8,000 tax credit and expanded $6,500 credit through June 30, 2010, as long as the Buyer enters into a legally binding contract before April 30, 2010, and closes by June 30th. It also doubles the income ceiling for qualification to $125,000 for individuals, and for joint filers with incomes above $225,000.
