It's Official -- Tax Credit Extended!

[Andrew Firger]

It’s official, on Friday President Obama passed the bill extending and expanding the first time homebuyer tax credit.

As stated in earlier posts, the tax credit will continue to benefit first-time homebuyers with an $8,000 credit, and will also cover homeowners that have been living in the same residence for five of the past eight years. These homeowners can get up to a $6,500 credit. Eligible income levels were also raised from $75,000 to $125,000 for single buyers and from $125,000 to $225,000 for a married couple.

It will be interesting to see how this new credit for current homeowners affects the market. It was put in place in hopes of pushing homeowners towards upgrading to new homes. Although the $6,500 may not seem like a whole lot, it might get some people to buy in the first half of 2010 rather than the end of the year.

This credit will last until June 2010, with homebuyers having to sign a contract by April 2010 to be eligible.