This is the tenth in a 12-part series of weekly posts on the 2009 Home Buyer Tax Credit. To see all the posts in this series, click here.
In order to qualify for the $6,500 tax credit, you must be a current homeowner who has owned a home for at least five years and be looking to move to a new home. The home you purchase must be your primary residence, meaning that you must live in the home you intend to purchase most of the time. Second homes or those used for vacation homes will not qualify for this tax credit.
When the economy boasts a healthy housing market, people usually upgrade their residence every seven years or so, thus the five-year residency stipulation for the tax credit – it is in place in hopes of returning to a pattern of home buying that will resemble that of a healthy market, one similar to the market before the crisis.
This five-year stipulation should also help to avoid the practice of buying a home in order to resell it quickly for a profit, commonly known as “flipping.”
You must meet certain income restrictions to receive the $6,500 tax credit; these are similar to the $8,000 first-time home buyer tax credit discussed in my earlier posts. Essentially, there is a cap of $125,000 annual salary for individuals, and a $225,000 cap for couples. Additionally, there is a limit to the value of the home you purchase. Homes valued at $800,000 or less will be the only ones that qualify.
You must sign and finalize your home purchase on or by April 30, 2010 to qualify for the credit, which is the same deadline put in place for the $8,000 tax credit.
You can find out more and download a free guide to tax credit information by clicking the following link: 2009 Home Buyers Tax Credit Guide-HS-1
