Do I qualify for the First Time Home Buyer Tax Credit Extension?  On November 6, 2009, President Obama signed the bill to extend the first time home buyer tax credit.  The bill extends the current $8,000 first time homebuyer tax credit through April 2010.  First-time homebuyers (people who have not owned a home within the last three years) are eligible for a tax credit of 10% of the purchase price of the home, with a maximum available credit of $8,000, if they meet the criteria.   

The bill also includes a tax credit of up to $6,500 for qualified move up or down buyers and increases the borrower income limits for both credits to $125,000 for individuals and $225,000 for couples.  The home price limit is $800,000.00. 

The tax credit was extended and revised to include home owners who have owned and lived in their home for 5 consecutive years.  The $6,500 tax credit is available for buyers of owner occupied primary residences who have owned during five of the eight years prior to the purchase.  The credit is extended to home sales that go under contract by April 30 and close by June 30, 2010.  

The new home being purchased doesn’t have to cost more than the old house.  Individuals who move from a high cost area to a lower cost area who meet all eligibility requirements will qualify for the $6,500.00 credit.   The provisions looks generally to the closing date.

The legislation also includes anti-fraud language that gives the IRS the authority to do greater oversight during the processing of the return.   Some of the restrictions to the First Time Homebuyer Tax credit are:  If you purchase a home from a direct blood relative (This includes a spouse, parent, grandparent, child or grandchild);  if you do not use the home as your primary residence;  if you sell the home before the end of the year; and if you are a nonresident alien.
 
Additionally, the bill waives the recapture provision for members of the armed forces who are called on extended duty.  Members of the military, who are out of the country for at least 90 days, will also be eligible to use the tax credit upon their return through April 30, 2011.