Homebuyer Tax Credits

Congress has extended and expanded the homebuyer tax credit.

If you have questions, review the Frequently Asked Questions (FAQ) below.

Frequently Asked Questions

1.  Existing homeowner credit: Must the new house cost more than the old house?

No. Thus, for example, individuals who move from a high cost area to a lower cost area who meet all eligibility requirements will qualify for the $6500 credit.

2.  I owned my home for 10 years, but sold it two years ago and have been renting since. If I purchase a home, will I be eligible for the $6500 tax credit if I meet all the other eligibility tests?

Yes. Because you lived in the home for more than 5 consecutive years of the previous 8, you will quality for the $6500 credit. For example, say John and his wife bought a home in 2000 and lived there until 2008 when he got a divorce. Whether John has been renting or bought in the interim, he WOULD INDEED be eligible for the credit because he owned a home and occupied it as his principal residence for 5 consecutive years out of the last 8 years. The keyword here is “consecutive”. As long as he lived in that house for 5 years straight what he did since 3 years doesn’t impact eligibility.

3.  I am an eligible first-time homebuyer. I entered into a contract to purchase on November 1, 2009. Do I have to go to closing before December 1? How does the extension date affect me?

You do not have to close before December 1. Therefore, so long as the contract settles before April 30 (or July 1, worst case), the purchaser will be eligible for the credit.