Another Insight About The Home Buyer Tax Credit

There’s still a lot of discussion about the Home Buyer Tax Credit, and just last week, it came up in a discussion with a new out-of-town client who is relocating to the Boulder Colorado area.

While we were meeting with Nora Ziel from Cherry Creek Mortgage to discuss financing options, the home buyer tax credit topic became a point of discussion, and it seems that no matter what Boulder neighborhood you may be interested in moving into, there’s a home that likely qualifies for the credit.

How much time do we have? What are the limits? Do you really get a check? Etc. My sister lives in another state, and she bought a new home recently and qualified for the credit. She said it didn’t take long to get the money (about 5 weeks), and that it wasn’t all that much paperwork.

Nora sent me some info via email on the tax credit, and I want to share that with you.

Call, text, or email me today! …especially if you’re ready to talk about selling your home, buying a new home, or know someone that is moving!

Here’s the low-down from Nora at Cherry Creek Mortgage:

Tax Credit for Homebuyers

First-Time Homebuyers (FTHBs): First-time homebuyers (that is, people who have not owned a home within the last three years) may be eligible for the tax credit. The credit for FTHBs is 10% of the purchase price of the home, with a maximum available credit of $8,000.

Single taxpayers and married couples filing a joint return may qualify for the full tax credit amount.

Current Owners: The tax credit program now gives those who already own a residence some additional reasons to move to a new home. This incentive comes in the form of a tax credit of up to $6,500 for qualified purchasers who have owned and occupied a primary residence for a period of five consecutive years during the last eight years.

Single taxpayers and married couples filing a joint return may qualify for the full tax credit amount.

What are the New Deadlines?

In order to qualify for the credit, all contracts need to be in effect no later than April 30, 2010 and close no later than June 30, 2010.

Tax Credit Versus Tax Deduction

It’s important to remember that the tax credit is just that… a tax credit. The benefit of a tax credit is that it’s a dollar-for-dollar tax reduction, rather than a reduction in a tax liability that would only save you $1,000 to $1,500 when all was said and done. So, if a first-time homebuyer were to owe $8,000 in income taxes and would qualify for a tax credit of $8,000, she would owe nothing.

Better still, the tax credit is refundable, which means the homebuyer can receive a check for the credit if he or she has little income tax liability. For example, if a first-time homebuyer is eligible for a tax credit of $8,000 but is liable for $4,000 in income tax, she can still receive a check for the remaining $4,000!

Higher Income Caps

The amount of income someone can earn and qualify for the full amount of the credit has been increased.

Single tax filers who earn up to $125,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, single filers who earn $145,000 and above are ineligible

Joint filers who earn up to  $225,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, joint filers who earn $245,000 and above are ineligible.

Maximum Purchase Price:

Qualifying buyers may purchase a property with a maximum sale price of $800,000.

Ready for a new home? Here’s a modern and energy-efficient remodeled home for sale in the Country Club Park subdivision of Boulder, or perhaps a downtown Louisville lot for sale so you can build your dream home is more for you.

You may also find  my neighborhood profiles, and  Boulder business profiles informative and useful. They’re both great ways to learn more about what’s going on in Boulder.

Call, Text, or Email me. I’m never too busy for your referrals.  As a real estate professional intent on giving back to the community, my relationship-based approach is exactly what you’ve been looking for in a helpful Realtor, and I will listen to you.

Zachary Epps, GRI, ABR, REALTOR®, full-time RE/MAX professional,  and author of the Boulder Area Neighborhood Guide.

Action is the antidote to despair.
– Joan Baez

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