Home Buyer Tax Credit Extension for eligible Military and Qualified Service Personnel

As the rest of the buyers are rushing to close escrow before the end of this month to take advantage of the Federal first time home buyer tax credit, qualified service personnel may be eligible for an extension. You can still take advantage of the $8000 federal income tax credit if you haven’t owned a home in the last three years, or $6,500 for current homeowners.

Conditions apply, such as income restrictions, which you will need to consult with your tax preparer or accountant. A qualified service member includes members of the US military, Foreign Service of the United States, and Intelligence Communities who have been on "official extended duty" outside the United States for a minimum of 90 days between December 31, 2008 and May 1, 2010. You can also check online for more information… http://www.federalhousingtaxcredit.com/service_mem.php

The program extension allows the purchaser to enter escrow with an agreed and signed contract by April 30, 2011 and close before June 30, 2011. You must use this home as your principal residence for 3 years.

The frenzy of buyers has somewhat eased with the tax credit deadline for the rest of us and inventory slightly better from the release of more foreclosed properties into the market (also known as Real Estate Owned, REO), you can take advantage of a little more selection and a little less competition.

Interest rates are still low, prices are low, a little more inventory, a little less competition AND the federal tax credit extension makes this a good time for qualified service personnel to enter the real estate market.

California homebuyers are also eligible for a State tax credit which is a limited first come, first served program. Just as the “Cash for Clunkers” program ended abruptly, expect this also to end soon. The tax credit allows the lesser of 5% of the purchase price or $10,000 divided equally into three years. You can take advantage of both programs if you hurry. As of June 8, 2010, the program has currently reached 57% of the estimated credit. See the following link for conditions and restrictions. http://www.ftb.ca.gov/individuals/new_home_credit.shtml

A word of advice… use a professional tax preparer who is up to date with current tax laws and keep your own files in order. It has been reported that the IRS is auditing returns claiming the home buyer tax credit.

For more detailed information in Orange County and surrounding areas send me a text or call 949.303.9532.