On November 6, 2009, the Worker, Homeownership and Business Assistance Act of 2009 was signed into law. This new legislation extends and expands the home buyer tax credit and extends unemployment benefits.
Home Buyer Tax Credit Extended and Expanded
Both first-time buyers and existing homeowners will be able to take advantage of the tax credit through the end of April 2010. The new law:
- Extends the tax credit of up to $8,000 for qualified first time home buyers until April 30, 2010
- Expands the tax credit to give up to $6,500 to current home owners who are purchasing a new or existing home
To get the tax credit, both first-time and existing home buyers must:
- Use the home as a principal residence for the next three years
- Purchase the home from someone who isn’t a relative
- Purchase a home that costs $800,000 or less
- Have income not over $125,000 if an individual or not over $225,000 for couples
To qualify for the first-time home buyer tax credit, a buyer must not have owned a principal residence during the three-year period prior to the purchase. To qualify for the existing homeowner tax credit, the homeowner must have lived in their current house for five of the last eight years.
Unemployment Benefits Extended
Under the new law, unemployment benefits have been extended for 14 more weeks nationwide and 20 more weeks in some of the hard-hit states. The extension brings maximum state and federal unemployment compensation to 99 weeks.
Check with your state’s unemployment office to see if you qualify.
Questions for Your Attorney
- As a new home buyer will I get the full $8,000 tax credit or does the amount of the credit depend on the price of the house?
- Can I purchase a home from a distant cousin and still get the tax credit?
- I have lived in my home for a total of five of the last eight years but the period was not consecutive. Does this disqualify me from getting the tax credit?