Posted by Mary Clare McGraw
Congress has extended the popular tax credit for first-time homebuyers and created a new tax break for homeowners looking to trade up.
Under the new law anyone who hasn’t owned a home in the past three years can claim a credit worth 10% of a home’s purchase price, up to $8,000. The new act also includes a tax credit of up to $6,500 for individuals and families who have lived in their homes for at least five years and want to move.
The deadlines are the same as for the first-time buyers’ tax credit — contract by April 30, closing by July 1.
Both credits require the home to be a principal residence and to cost no more than $800,000. These tax breaks are particularly valuable because they’re credits, not deductions.
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