President Obama signed the Home Buyer tax credit legislation, per the reporting of the United Press International. It’s called the Worker, Homeownership, and Business Assistance Act of 2009. The San Francisco Chronicle has an excellent bullet-point breakdown of the fine print of the new law. This is a partial summary…
- Up to $,8000 federal tax credit available to home buyers who haven’t owned in the past 3 years
- Up to $6,500 federal tax credit available to to people who currently own a home which they’ve lived in for 5 of the past 8 years, and who purchase a new one to live in
- As far as applying for the credit, I’m pretty sure it’ll just be a line item on your typical federal tax return when you file in April 2010 for tax year 2009
The wonderings:
- I wonder if the $6,500 was a nod to the homeowners who keep shouting “I was responsible, I put 20% down, I didn’t spend all my home equity frivolous things, I paid my mortgage on time…. I did the right thing and where’s my bailout?!?!?” (actually this is courtesy of partner Chris Butterworth)
- I wonder how much impact the new $6,500 credit will have on the ‘move up market’ of folks who sell their starter home and move up to the newer, bigger, nicer house in the suburbs (so to speak)
- I wonder if ‘home owner’ equals someone who owns and lives in their home as of the date the bill became law (i.e. November 6) or as of December 31, 2009?
Heather Barr is a Realtor and a happy workaholic. She eats more than someone her size ought to be able, and is a runner as a consequence. Her TiVo's full of spy thrillers, police procedurals and Whedonesque sci-fi.
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Here is some add’l info regarding the new credit for $6,500.
The law defines a tax credit qualified move-up home buyer (“long-time resident”) as a person who has owned and resided in the same home for at least five consecutive years of the eight years prior to the purchase date. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse. Repeat home buyers do not have to purchase a home that is more expensive than their previous home to qualify for the tax credit.
The income limit for single taxpayers is $125,000; the limit is $225,000 for married taxpayers filing a joint return. The tax credit amount is reduced for buyers with a modified adjusted gross income (MAGI) above those limits. The phaseout range for the tax credit program is equal to $20,000. That is, the tax credit amount is reduced to zero for taxpayers with MAGI of more than $145,000 (single) or $245,000 (married) and is reduced proportionally for taxpayers with MAGIs between these amounts.