11/12/2009
First-Time Homebuyer CreditThe Worker, Homeownership, and Business Assistance Act of 2009 extends and modifies the homebuyer credit. The credit had been scheduled to expire Dec. 1. Under the bill, it is extended to May 1, 2010, and is modified so that taxpayers do not have to close on the house by that date, but merely have to enter into a binding contract by that date. To be eligible for the credit, taxpayers who have entered into a binding contract to purchase an eligible principal residence by May 1, 2010, must close before July 1, 2010.
In another major change, the credit is also modified to apply not just to first-time homebuyers. Under the bill, taxpayers who have owned and lived in their old house for any five consecutive years within the preceding eight years will be treated for purposes of the credit as first-time homebuyers. However, instead of the full $8,000 credit, such long-term residents would be eligible for only a $6,500 credit.
The bill increases the income limitations for credit eligibility to $125,000 for individuals (and $225,000 for couples). It also introduces a purchase price limit: No first-time homebuyer credit will be allowed for the purchase of any residence if the purchase price is more than $800,000.
Are you considering buying a new home? Follow this link and find out if you're ready for home ownership: http://www.lcpa.org/mm_homeownership.html
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