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Federal and State of Kentucky Home Purchasing Tax Credit Program

UPDATED NOVEMBER 7TH.

The first time home buyers Federal tax credit has been extended and expanded by the Senate and House and on Friday November 6th the President signed the bill. The new law will extend the $8,000 credit for first-time home buyers for sales contracts entered into by April 30, 2010 and closed by June 30. Further, it has been expanded to include a new $6,500 credit for owners of existing homes who are purchasing a new principal residence. An existing home owner can claim the $6,500 tax credit if they have been residing in their principal residence for five consecutive years out of the last eight. Additionally, the income eligibility limits to claim the full credit amount for both groups of home buyers have been raised to $125,000 for individuals and $225,000 for married couples.

Your purchase of a newly constructed home may be eligible for a state tax credit of up to $5,000 on your Kentucky tax return. Any attached or detached home that has never been occupied qualifies. Credit expires July 25, 2010 for home sales closed on or prior to this date or until the $25 million dollar limit has been reached. For more information check out the Kentucky Department of Revenue website.

BOLD Homes has two homes ready for immediate occupancy and will match your Federal or State tax credit dollars. Contact Mike Kegley for more details at 859-657-6700.

THIS WILL BE THE LAST CHANCE TO USE THE TAX CREDIT

Even as Congress neared completion this week on legislation to extend and enhance the home buyer tax credit, proponents of the tax credit made it perfectly clear that the extension would have a limited shelf life and not be extended again when it expires next year.

Sen. Johnny Isakson (R-Ga.), a long-time champion of the home buyer tax credit, said: “This is the last extension of the home buyer tax credit. Tax credits like this only work by creating the sense of urgency to take advantage of it, and to bring the market back.”

On the floor of the Senate, Finance Committee Chairman Max Baucus (D-Mont.) said that, “it’s important that this tax credit does not become a permanent fixture in the tax code. Our amendment would end the credit on April 30 of next year. This extension would get us through the winter” traditionally the worst season for real estate. Our amendment would jump-start the housing market as it enters the summer months of 2010. Baucus added that the seven-month extension of the tax credit would be “long enough to encourage home buyers to buy homes, but it’s short enough to remain fiscally responsible.”

MORE TO FOLLOW

Check back to this posting for the latest updated information on both tax credits.

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