Program Ends April 30, 2010

The Big News: The new legislation adds a $6500 tax credit for existing homeowners who contract to buy a new home by April 30th, 2010. The home you sell must have been your current residence for a consecutive 5 years out of the last 8. The income limits are the same as for first time home buyers (see below) and the new home can cost up to $800,000. You have to be in a written binding contract to purchase the new home by April 30th, but have until July 1st to actually close or finalize the sale. The 5 consecutive years rule is meant to keep investors and fix and flip buyers from receiving the tax credit. 

The $8000 first time home buyer tax credit that was set to expire at the end of November, has been extended until April 30th, 2010. Also, the annual income limits to qualify for either credit have been increased from $75,000/single and $150,000/married to $125,000/single and $225,000/married. Above those income levels, the credit is reduced and eventually phased out. The rules are still the same for determining a “first-time home buyer” – you just have to have not owned a home as your personal residence in the last 3 years.