Housing credit extended for active duty
Special rules for military, foreign service
The 10% federal housing credit, of up to $8,000 for first-time homebuyers and to $6,500 for qualifying current homeowners will be a big boost to buyers (and sellers) early in 2010.
To qualify for the 10% first-time homebuyer credit, you must not have owned a principal residence in the three years prior to the date of purchase of the home for which you are claiming the credit. Buyers who have owned a home can also get the 10% credit if the home being sold or vacated was used as a principal residence for five consecutive years within the last eight. To qualify for either credit, you must write a contract by April 30 and close on the home, which you must use as your principal residence, by June 30.
The latest (probably last!) version of the credit law has an $800,000 maximum for the home’s cost. An income limit also applies. Your “modified” adjusted gross income (MAGI) cannot exceed $225,000 if you are filing a joint return to get the full credit. If you are single, your MAGI can be as high as $125,000 and get a full credit.
There is a group that will get another year to take advantage of the credit and reap the benefits: armed services members and intelligence and foreign service personnel who were on active duty outside of the U.S. for 90 days during 2009. These individuals have through April 30, 2011 to write a contract and must close by June 30, 2011.
While other buyers who sell their home after fewer than three years occupancy have to repay the credit, armed service and foreign and intelligence service members who must sell due to official business do not have to repay it. © 2010, Real Estate Information Services, Capitol Assets & Choice Finance®
Contributing writer & VA Loan Officer, Eric Strasser
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