The Senate and House have already passed the new tax credit and the White House indicated that the President will sign the legislation.
How the home buyer tax credit would work:
•· Tax credit: Ten percent of the purchase price of a primary residence, up to a maximum of $8,000 for first-time home buyers and $6,500 for repeat buyers who purchase between December 1, 2009 and May 1, 2010. First-time home buyers are defined as people who have not owned a home in the previous three years. Repeat buyers must have owned their current home at least five years. The credit cannot be used for houses costing more than $800,000.
•· Deadline for qualifying:Purchase agreements must be signed by April 30, 2010, and closings must be final by June 30.
•· Military deadline: The deadline is extended by a year for members of the military who have served outside the U.S. for at least 90 days from Jan. 1, 2009, to May 1, 2010.
•· Income limits: Individuals with annual incomes up to $125,000 and joint filers with incomes up to $225,000 qualify for the full credit. Individuals with incomes up to $145,000 and joint filers with incomes up to $245,000 qualify for reduced credits.
•· How to apply: Taxpayers can claim the credit on their federal income tax returns. If the credit exceeds their tax bill, the government will issue a payment. Taxpayers who want immediate refunds can amend their tax returns for 2008 to claim the credit.
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Murray, UT 84107
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