The first-time homebuyer’s credit has gotten a lot of attention in recent months, but did you know that repeat homebuyers can also get in on the savings?
When the homebuyer’s tax credit was extended, it was also expanded to include repeat homebuyers who meet certain requirements. That’s good news if you’re searching for a Pacific Northwest home that better meets your family’s needs.
In this market, the buyer is king (or queen); interest rates have fallen to historic lows, and fantastic Northwest homes are available at extremely affordable prices throughout Whatcom, Skagit, Island and San Juan Counties.
Here are the details that apply to Repeat Buyers:
-Existing homeowners who have been residing in their principal residence for five consecutive years out of the last eight and are purchasing a home to be their principal residence (“repeat buyer”), may be eligible for up to a $6,500 tax credit.
-All U.S. citizens who file taxes are eligible to participate in the program.
Homebuyers who file as single or head-of-household taxpayers can claim the full credit ($6,500 for repeat buyers) if their modified adjusted gross income (MAGI) is less than $125,000.
-For married couples filing a joint return, the combined income limit is $225,000.
-Single or head-of-household taxpayers who earn between $125,000 and $145,000, and married couples who earn between $225,000 and $245,000 are eligible to receive a partial credit.
-The credit is not available for single taxpayers whose MAGI is greater than $145,000 and joint-filers with a MAGI that exceeds $245,000.
-The eligibility period for the tax credit is for homes purchased after Nov. 6, 2009, and before May 1, 2010. However, home purchases subject to a binding sales contract signed by April 30, 2010, will qualify for the tax credit as long as closing occurs prior to July 1, 2010.
Types of Homes that Qualify
-All homes with a purchase price of less than $800,000 qualify, including newly-constructed or resale, and single-family detached, townhomes or condominiums, provided that the home will be used as their principal residence. Vacation home and rental property purchases do NOT qualify.
Tax Credit is Refundable
-A refundable credit means that if the amount of income taxes you owe is less than the credit amount you qualify for, the government will send you a check for the difference.
-For example: A repeat buyer who owes $5,000 would pay nothing to the IRS and receive $1,500 back from the government. If you are due to get a $1,000 refund, you would get $7,500 ($1,000 plus the $6,500 repeat buyer tax credit).
-All qualified homebuyers can take the tax credit on their 2009 or 2010 income tax return.
If you’re looking for a dream home in the Pacific Northwest, I’m here to help! Contact me or feel free to browse my free, no-hassle Northwest MLS search.