The Woodlands Real Estate

$8,000 Tax Credit - you still have time!

You have been living in a hole if you have not heard about the $8,000 tax credit available to first time homebuyers or those who have not owned a home within the last 3 years. What you may not have heard yet is that this tax credit, which was once set to expire November 30th, has been extended until April 30th, 2010! Not only did the Senate vote Wednesday to extend the tax stimulus package, but they have glammed it up to include current home owners who can now receive up to $6,500! To qualify, buyers in both groups have to sign a purchase agreement by April 30, 2010, and close by June 30. The credit is available to purchase a principle home (no vacation homes this time!) costing $800,000 or less by individuals with incomes up to $125,000 and joint filers with incomes up to $225,000. Critics say the tax credit is poorly targeted because the majority of the people taking advantage of the credit would have purchased a home anyway…how do they know that? As REALTORS we have talked to countless buyers who are in the market at this time specifically to take advantage. We are thrilled with the results and it could not have come at a better time as we struggle through this topsy turvey economic market! The tax credit is equal to 10 percent of the purchase price of a primary residence up to a maximum of $8,000 or $6,500 depending on your situation. Taxpayers claim the credit on their federal income tax returns. If the credit exceeds their tax bill, the government will issue a payment.