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President Expands Home Buyer Tax Credit

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Nov 6, 2009 7:45 pm US/Eastern

President Expands Home Buyer Tax Credit

Reporting
Jon Delano
PITTSBURGH (KDKA) ― Miss out on the very popular Cash For Clunkers program?

Don't worry -- this recession is spawning still another way to get you to spend your money.

It's a brand new tax credit for lots of people -- not just first-time home buyers -- if you sell your current home and buy another one over the next six months.
 
If you do that, here's what you get: a $6,500 tax credit. That means you can deduct $6,500 from the taxes you owe the federal government.

So who is eligible for this tax credit?

First, you must have owned your principal residence for at least five years.

Second, the next home you buy must be $800,000 or less.

Third, you must sign a purchase agreement by April 30, 2010, and close on the home within 60 days thereafter.

Fourth, you must stay in the new home for at least three years or repay the credit.

Fifth, your individual income must be less than $125,000 or $225,000 for couples.

Economists predict that this tax credit is likely to spur a home buying and selling boom.

As for first-time home buyers, Congress extended the $8,000 tax credit through April 30th as well for these first-time purchasers.

By the way, if you owned a home at one time but have not owned one for the last three years, you now qualify as a first-time home-buyer.

As for the rest of us, as long as you've lived in your current home for at least five years and meet the dollar requirements, it could be a good time to make the move you've been wanting to make.

(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)

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