Now should be the time to act if you intend to take advantage of the tax credit for existing homeowners looking to buy a new home.
When the government extended the federal tax credit for first time homebuyers on November 6, 2009, existing homeowners where able to purchase a new home as a primary residence and receive up to $6500 as a tax credit.
However, tax payers were warned not to file for the tax credit for repeat homebuyers without having obtained the revised forms and new instructions.
As of January 15, 2010 repeat buyers have been able to obtain the revised Form 5405 at the www.irs.gov.
The credit for repeat buyers is for up to 10% of the purchase price of the home with a max of $6,500. The purchase contract must be signed and dated from November 7, 2009 to April 30, 2010. The closing must be completed no later than June 30, 2010 to claim the credit. There are extensions of up to a year given to members of the armed forces, federal diplomats and intelligence personnel that are stationed overseas. The purchase price of the home can not exceed $800,000 and purchasers are not required to sell their ancient residence. However, they must prove that they intend to use the purchased home as their primary residence.
Posted on the IRS site are answers to some key questions such as the documentation that home buyers must submit with their $6500 claim. Repeat buyers claiming the credit should attach the following applicable documents to their 2009 and 2010 tax returns:
- Copy of HUD-1 settlement sheet, including the contract sale price of the house and the date of closing.
- Proof of long-term ownership and occupancy of previous home in order to meet the five consecutive year’s requirement.
There are additional documents required in some cases, so for a complete list visit their website www.irs.gov.
One thing is for certain, if you intend to take advantage of the credit, time is short, hurry; you only have until April 30 to sign a purchase contract and June 30 to close.
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Paul, I don’t know about you, but I haven’t had much luck with the “upgrade” homebuyers looking to take advantage of the tax credit…Where I live and sell in Jupiter, Florida, most of the tax credit seekers are first time homebuyers. How does it stack up for you when you compare the two different groups eligible for the tax credit?
.-= DJ Morris´s last blog ..Abacoa Real Estate Scams in Jupiter, Florida =-.
I wish this had an impact on NYC… it is just not enough money to make a difference.
While a great idea in theory, in practice I’ve heard of very people who have been incentivized by these programs. If the government would expand the program to include other buyers, it’s impact would certainly be felt much more.
Not enough money seems to be the consensus with everyone that I have talked to about this. Thanks for stopping by!
Why not, if the Goverment want to give away $6500 to you when you buy a new home, grab it and say thanks. But you must hurry.
My girlfriend and I looking to take advantage of this before it runs out. I’m curious to see the impact this will have on home sales in the 2nd half of this year.
These incentive gives off good motivation for home buyers who want to purchase a property. Nice post! Informative! Keep it Up!
.-= Orem Utah Homes´s last blog ..Previewing February’s New Home Sales: The numbers declined! =-.
The housing market is still pretty weak. The government’s $15000 tax credit program might just push through. If it does, surely there would be more citizens who would be motivated to purchase a home.
When there is free money to be had to help with a purchase, you take it. I do however, think that this incentive will skew the purchase numbers in future reporting.
.-= Team Jodi´s last blog ..1039 Pinehurst Drive, Chapel Hill, NC 27517 =-.
I guess a lot of people did claim the tax credit while there was still time because it seems like there aren’t nearly as many buyers without the incentive from the government.