$10,000 CA Tax Credit

The State of California has passed a new credit for qualified first-time home buyers who buy a qualified principal residence from May 1, 2010 through the end of the year.  This would apply to almost all San Diego North County homes for sale.  Escondido homes or Encinitas homes can be mobile homes, manufactured homes, attached homes, condos, or even a houseboat.  Haven’t seen many of those in San Diego North County.

To be a buyer eligible to buy these San Diego North County homes you must be a first-time buyer.  You or your spouse cannot have had an ownership interest in any home, anywhere, in the last 3 years.  You are not eligible if you used the 2009 new home tax credit or if you are under 18.

Applications for these credits are being accepted now by the State.  The State has set aside $100,000,000 for this program, but when the money runs out, so does the program.  It is strictly, first come, first serve.  It is estimated that the money will run out by the end of May.

If you want to get in on this great opportunity you had better get started.  Contact Gary Harmon, your top North County Realtor today.  For more information see California 2010 Tax Credit First Time Buyer.

New California First-Time Homebuyer Tax Credit

With the Federal Tax Credit expiring on April 30, 2010, Governor Schwarzenegger saves the day by signing AB 183 into law.  The new first-time homebuyer tax credit becomes effetive on May 1, 2010.    It will be on a first come, first serve basis and when the $200 million runs out the credit is over.  Unlike the previous state tax credit which applied only to new residences, this credit will be split equally between new (previously unoccupied homes) and existing homes.   This website will discuss how the credit affects Escondido real estate purchases, but the same rules would apply to other San Diego North County real estate sales. 

First of all to qualify for the first-time homebuyer tax credit, you must be a first-time Escondido home buyer.    The amount of the tax credit on your Escondido home purchase is limited to 5% of the Escondido home for sale price or $10,000, which ever is smaller.  You will receive you tax credit over three consecutive years.  To be eligible you must purchase a qualified Escondido home between May 1, 2010 and December 31, 2010.   If you enter an enforceable purchase contract before December 31, 2010, it must close escrow before August 1, 2011 to qualify.   Again, when the money runs out the program is over.

The new California first-time homebuyer tax credit is expected to have a very positive impact on the Escondido home economy and around the state.  Nearly 40% of first-time home buyers said they would not have purchased without the Federal tax credit.  The California credit is expected to provide similar results.   For more information about tax credits, contact Gary Harmon, your Escondido Realtor.

Tax Credit vs. Tax Deduction

Most Escondido home buyers are aware of the first-time home buyer tax credit.  Current owners of Escondido real estate are aware of the $6,500 tax credit.  But are these real credits or are they tax deductions.  They are real credits.  The importance of the tax credit is that it is a dollar-for-dollar tax reduction.  For example, if a first-time Escondido home buyer were to owe $10,000 in taxes, after the credit they would owe $2,000.  Better yet, this tax credit can be refundable in some cases.  If the elgible buyer owed nothing in taxes, they could get a check from the IRS for $8,000 or $6,500 depending on the program.  For more information see “First time home buyer tax credit extension” or contact Gary Harmon, your Escondido Realtor.  You can also get great information from the video below.

$6,500 Tax Credit

Everyone knows about the $8,000 tax credit for first-time Escondido home buyers, but what is the $6,500 tax credit?  The $6,500 tax credit is for current Escondido home owners.   The purchase must be a new primary residence.  To be eligible you must purchase your Escondido home between November 6, 2009 and April 30, 2010.  Your Escondido home purchase must be  closed by June30, 2010.   To be eligible for the $6,500 credit, the buyer must have lived in their current primary residence for five consecutive years out of the last eight years.  There is a limit on the purchase price of the Escondido home and that is $800,000.  There is also a maximum amount you can earn and still be elgible.  That maximum amount is $$125,000 if you are a single filer and $225,000 for Escondido buyers filing jointly.  A partial tax credit can be granted to single filers earning up to $145,000.   Escondido buyers filing jointly can earn up to $245,000.  In summary, there is a first-time home buyer tax credit of $8,000 and a $6,500 tax credit for current homeowners.

For more information about tax credits contact your Escondido Realtor, contact Gary Harmon.

First-time Home Buyer Tax Credit, See Video!

First-Time Home Buyer Tax Credit has been Extended!

What are the Main Terms of the Tax Credit?

  1. Escondido real estate before May 1 and close before July 1, 2010.
  2. Escondido homes must be purchased by a First-Time Home Buyer.
  3. The maximum credit is $8,000 or 10% of the Escondido Real Estate, whichever is less. 
  4. Escondido first-time buyers who are claimed as dependents by other taxpayers or who are under age 18 are not qualified for the tax credit program.
  5. The maximum allowed Escondido home purchase price is now $800,000.
  6. Single taxpayers may now earn up to $125,000 and married taxpayers filing jointly may earn up to $225,000
The First-Time Home Buyer Tax Credit is for first-time buyers of Escondido real estate (either spouse if filing jointly) who have NOT owned a principle residence during the 3 year period prior to the purchase.   
Call Gary Harmon, your Escondido Realtor, to find out more about the first-time home buyer tax credit.