The homebuyer’s tax credit that was due to expire at the end of November has been extended to April 30th 2010. In addition to this a new tax credit has been introduced for current homeowners who want to sell their home and buy another.
The amount of tax credit for new homeowners remains the same ($8000), but there are some addition criteria that need to be met.
- You must not have had an interest in a principle residence in the last three years.
- The purchase contract must be in effect on or before the 30th of April 2010. You have until the 1st July 2010 to close.
- Income limits of $125,000 for single people and $225,000 for Married couples (these amounts have been increased from the first tax credit). There is an additional $20,000 where the tax credit amount is phased out.
- $800,000 limit on the purchase price (new rule).
- The home cannot be purchased by a dependent (new rule).
- The purchaser must attach documentation to their tax return (new rule).
The tax credit for current homeowners is $6500 ($3250 if you are married filing separately). In order to qualify for this you must have used the home sold as your principle residence for 5 of the last 8 years. Rules 2 through 6 must also be met in order to claim the $6500.