First-time homebuyers (the purchaser or his/her spouse may not have owned a residence during the three years prior to purchase) can qualify for up to a maximum $8000.00 in tax credit. Existing homeowner (who have owned their current home for at least five consecutive years within the last eight) can qualify for up to $6500.00 in tax credit.
The good news is that allowable income limits, a road block for many Americans in prior offerings, have increased over previous tax credit programs. The Extended Tax Credit program caps income at $125,000. ( in order to receive the maximum tax credit) and $225,000 per year for couples, the latter up $75,000. over the previous program.
It's interesting to note that home buyers whose income exceeds these limits may still be eligible for a portion of the credit. Termed a "credit phase out," the credit decreases for buyers who earn between $125,000. and $145,000 fro single buyers filing jointly. The amount of the tax credit decreases as the income approaches the maximum limit. However, homebuyers that exceed $145,000 for singles and $245,000 filing jointly are not eligible for the credit. as always, your best bet is to consult your tax professional regarding your individual situation.
The legislation limits eligibility for primary residences (not second homes or investment properties) prices at $800,000 or less. Primary residences include single family homes, condos, townhouse, and co-ops.
