NAR Issue Brief

Homebuyer Tax Credit Changes

National Association of REALTORS® Government Affairs Division

500 New Jersey Avenue, NW, Washington DC, 20001

Congress has extended and expanded the homebuyer tax credit. The modifications in the column labeled

“December 1 – April 30, 2010” become effective when President Obama signs the bill. All changes made

to the current credit become effective on that date, as well.

FEATURE Jan 1 – November 30, 2009 Rules as enacted February 2009

December 1 – April 30, 2010 Rules as enacted November 2009

First time Buyer – Amount of Credit $8000 ($4000 married filing separate)

First time Buyer – Definition for Eligibility

May not have had an interest in a principal residence for 3 years prior to purchase

Current Homeowner – Amount of Credit $6500 ($3250 married filing separate)

Current Homeowner – Definition for Eligibility Must have used the home sold or being sold as a principal residence consecutively for 5 of the previous 8 years

Termination of Credit Purchases after November 30, 2009 (Becomes April 30, 2010 on Date of Enactment.)

Purchases after April 30, 2010 Binding Contract Rule  So long as a written binding contract to purchase is in effect on April 30, 2010, the purchaser will have until July 1, 2010 to close.

Income Limits (Note: Increased income limits are effective as of date of enactment of bill)

Effective Date 1-01-09 $75,000 – single $150,000 – married Additional $20,000 phase out

Effective Date 12-01-09 through 4-30-2010 $125,000 – single $225,000 – married

Additional $20,000 phase out

Limitation on Cost of Purchased Home  $800,000 Effective Date of Enactment

Purchase by a Dependent No Provision Ineligible Effective Date of Enactment

Antifraud Rule  Purchaser must attach documentation of purchase to tax return

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