Good news for Massachusetts first-time home buyers arrived this Friday, November 6th, when President Obama signed into law legislation extending and expanding the Federal Housing tax credit. The tax credit is now not only for MA first-time home buyers, but for qualified MA repeat home buyers as well. The new law also raises the income limits under which Massachusetts home buyers can qualify for the credit.
According to the Worker, Homeownership and Business Assistance Act of 2009, the following provisions apply under the new law :
- An eligible taxpayer must buy or enter into a binding contract to buy a principal residence with a maximum sales price of $800,000 on or before April 30, 2010 with the closing to occur by June 30, 2010. For qualifying purchases in 2010, taxpayers have the option of claiming the credit on either their 2009 or 2010 tax return.
- The first-time home buyer tax credit remains at $8000, but a new option for repeat home buyers has been added whereby they can now claim a home buyer credit up to $6500 (up to $3250 for a married individual filing separately). Repeat home buyers must have lived in the same principal residence for any five-consecutive period during the eight-year period that ended on the date the replacement home is purchased.
- Income limits under the new law for homes purchased after November 6th have been increased. The credit now phases out for individual taxpayers with modified adjusted gross income between $125,000 and $145,000 or between $225,000 and $245,000 for joint filers.
Qualified Massachusetts home buyers can claim the tax credit on IRS Form 5405. More detailed information on the tax credit is also available on the IRS Home Buyer Tax Credit web page.
If you’re a MA home buyer even remotely thinking of claiming the tax credit, I recommend that you start a serious home search now. While the deadline for the tax credit is not until April 30, 2010, the holiday season and winter are fast approaching which always results in a decrease of properties on the market in Massachusetts. And even more important, Massachusetts mortgage rates are currently at their best level since hitting their lowest point back in May. But don’t expect that to last for long…the government program to support the mortgage market is being phased out and ends completely in the 1st quarter of 2010.
For a no-obligation quote on current Massachusetts mortgage rates or a FREE special report on “The Importance of Acting Now : Why Waiting Could Really Cost You”, please feel free to contact me.
Geof McLaughlin
The Massachusetts Mortgage Broker
Certified Mortgage Specialist, CRMS, CMPS
Mortgage Master, Inc.
508.656.0055
geof@MAMortgageBroker.com
