Archive for Move Up Home Buyer Tax Credit

Move Up Homebuyer Tax Credit

Posted in Tax Credit with tags , , , , , , , on February 11, 2010 by Veldon Law

In his business development activity in working with The Flagship Financial Group, the author Veldon L. Law  offers the following advice received from Flagship Financials’ Corporate CPA in understanding the new Move Up Homebuyer Tax Credit.

Here is some info on the new Move Up Homebuyer Credit.

The law defines a tax credit qualified move-up home buyer (“long-time resident”) as a person who has owned and resided in the same home for at least five consecutive years of the eight years prior to the purchase date. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse. That is, both spouses must qualify as long-time residents, with at least five years of principal residency for each. Repeat home buyers do not have to purchase a home that is more expensive than their previous home to qualify for the tax credit.

The income limit for single taxpayers is $125,000; the limit is $225,000 for married taxpayers filing a joint return. The tax credit amount is reduced for buyers with a modified adjusted gross income (MAGI) above those limits. The phase out range for the tax credit program is equal to $20,000. That is, the tax credit amount is reduced to zero for taxpayers with MAGI of more than $145,000 (single) or $245,000 (married) and is reduced proportionally for taxpayers with MAGIs between these amounts.

The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $6,500. Purchases of homes priced above $800,000 are not eligible for the tax credit.  — Veldon Law

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