Dennis Norman
UPDATE 11/05 2:00 pm – The House has passed the bill by a vote of 403 – 12 – It now goes to the President who is expected to sign today or tomorrow.
UPDATE 11/05, 12:35 pm- To read the section of H.R. 3548 that contains the details concerning the first-time home-buyer tax credit click here.
If you care to read the entire bill click here.
UPDATE: At 5:28 p.m. by a vote of 98 to 0 the Senate Passed H.R. 3548 – It now will go to the House where it is expected to pass and then go to the President for him to sign into law.
The Senate voted 97-1 at 12:16 pm today (eastern time) to end debate on H.R. 3548 (The Unemployment Compensation Extension Act of 2009) which includes the amendment extending and expanding the home-buyer tax credit program.
So where does it go from here?
- The Senate will need to vote on passage of the bill with the amendment.
- If the Senate passes the bill, then the House could take up the bill in the next day or so. The thought is they will accept the Seante bill and vote on it. However, if this is not the case and they make changes, then that will slow down the process.
- Assuming the House passes the bill without change then the bill will then go to the President for his signature. The National Association of REALTORS has stated the white house has indicated the President is planning to sign the bill if passed.
I’ll keep you posted as I learn more…
Below is a recap of provisions in the amendment from the National Association of REALTORS(R):
- Credit available for purchases before May 1, 2010. Prospective purchasers with binding contracts in place as of April 30, 2010 will be allowed an additional 60 days to complete the transaction.
- Credit remains at $8000 for first-time purchasers. No change to definition of first-time purchaser.
- New $6500 tax credit for repeat buyers who purchase between December 1, 2009 and May 1, 2010. Repeat buyers must have lived in their homes consecutively for 5 of the previous 8 years.
- Income limits are expanded to $125,000 on a single return and $225,000 on a joint return. Current law $20,000 phase-out retained.
- New anti-fraud limitations are imposed.
What happens if I bought a home in 2003, but sold it mid-2007 and am now purchasing a new home? It seems like I do not qualify for the new-home credit (b/c it hasn’t been 3 years since I “owned” a home), but I also don’t qualify for the home-owner credit, b/c I didn’t own it for 5 years. Is that right?
Hi Nicole,
My usual quick disclaimer, I am not an attorney and this is not legal advice, but from my understanding of what is contained in the amendment that was passed you are correct and would unfortunately not qualify for the credit.
Dennis
Hi Dennis,
In regards to the new $6,500 credit, do you need to sign a contract or close between December 1, 2009 and April, 2010? I am in nogitations at this time and if all works out my contract should be signed shortly. I will close in that time frame but my contract would most likely have a November 2009 date. Would this purchase qualify?
Hi Diane,
Thanks for your comment. Thanks for you comment..For starters, I am not an attorney and this is not legal advice. Having said that, I have been very closely following the home-buyer tax credits though. Remember, this is not fully passed yet, still needs to go through the House and President, but assuming it passes in it’s current form, it states for existing home owners they have to purchase after Dec 1st…I’m not sure if this means not enter into a contract to purchase until after Dec 1st or just close the transaction after Dec 1st. My guess is, it is based upon the closing of the sale. Therefore if that is the case and I was you I would talk with the seller, explain the situation and see if you can negotiate to change the closing until after Dec 1st. For whatever inconvenience this may cause you it may be well worth it to get the $6,500 credit.
Good luck!
Dennis,
We have a first home where we have been in for more than 5 years. We have also bought a condo in Sept, 2009. If we buy another one, which is not a second home but a third home, in Dec, 2009, will we qualify for this new tax credit?
Thanks, Carol
HI Carol,
Here is the part of the bill passed by the Senate that discusses the credit for previous homeowners – I’m not sure if the condo you are buying is going to be your principal residence, but it appears it would need to be in order to qualify…If you want to see the entire bill as passed by the Senate, I just added links to the entire bill as well as to just the home-buyer tax credit section of the bill my latest update on the tax credit at:
http://realestateconsumernews.com/financing/home-buyer-tax-credit-extension-update/
`(6) EXCEPTION FOR LONG-TIME RESIDENTS OF SAME PRINCIPAL RESIDENCE- In the case of an individual (and, if married, such individual’s spouse) who has owned and used the same residence as such individual’s principal residence for any 5-consecutive-year period during the 8-year period ending on the date of the purchase of a subsequent principal residence, such individual shall be treated as a first-time homebuyer for purposes of this section with respect to the purchase of such subsequent residence.’
I purchased a home (my first home) in August 2009 and did NOT qualify for the tax credit due to my income. However, with the income limits raised with the new bill, I would have qualified. Do you think the income limits will be retroactive, or did I miss the boat by a few months?
I purchased a new home in August 2009 and coverted my condo, which i lived in for the past 6 years, into a rental property. The way the Bill appears to be written the $6.500 credit only applies to purchaes between 12/1/09 and 5/1/10. Will I be the target of the creadit but miss out b/c of the date restrictions? Could this be an error and correctly reflect Jan 1, 2009?
So, Dennis, we live in Pennsylvania and the condo is in Florida. Can it be a Principal residence or is it vacation home? A vacation home doesn’t qualify, does it?
Thanks, Carol
Hi Carol,
Unfortunately the way I read it, the credit only applies to principal residences and not vacation homes…
Here is the section of the bill that references it:
(b) Special Rule for Long-time Residents of Same Principal Residence- Subsection (c) of section 36 of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:
‘(6) EXCEPTION FOR LONG-TIME RESIDENTS OF SAME PRINCIPAL RESIDENCE- In the case of an individual (and, if married, such individual’s spouse) who has owned and used the same residence as such individual’s principal residence for any 5-consecutive-year period during the 8-year period ending on the date of the purchase of a subsequent principal residence, such individual shall be treated as a first-time homebuyer for purposes of this section with respect to the purchase of such subsequent residence.’.
Take care, Dennis
Hi Denis
Where did you get below, dont think Dec 1st is mentioned any where in the bill , you may want to correct above article … thanks
“New $6500 tax credit for repeat buyers who purchase between December 1, 2009 and May 1, 2010. Repeat buyers must have lived in their homes consecutively for 5 of the previous 8 years.”
Hi Mario
I’m not sure where you found the quote you have in your comment but I didn’t search…You are correct though, there is no mention of Dec 1st…the bill went into effect when it was signed on November 6th….Thanks for pointing this out..
Take care, Dennis