As the federal homebuyer tax credit ends , a CA state homebuyer tax credit begins. The homebuyer tax credit signed into law in March by Gov. Arnold Schwarzenegger is available effective today.
Assembly Bill 183 established a tax credit of $10,000 or 5 percent of the purchase price of a newly built home and a $10,000 tax credit for first-time purchasers of existing homes. The credit is good through Dec. 31, 2010 or until the money runs out, whichever comes first. The $200 million allocated for the program is split evenly, with $100 million going to purchasers of new homes and $100 million to first-time buyers of existing homes. More information on the state tax credit is available at www.ftb.ca.gov/individuals/new_home_credit.shtml.
The federal government offered buyers who haven't owned a home for three years a tax credit of 10 percent of the purchase price, up to $8,000, as well as a credit of 10 percent, up to a maximum of $6,500, for buyers who already owned a home for at least five years. Single buyers with incomes above $145,000 and couples making more than $245,000 were not eligible. Homebuyers who had signed contracts in hand by Friday's, 4/30/2010, deadline have until June 30 to complete their deals to receive the federal tax credit, and according to CA state officials, they can also take advantage of the CA state tax credit as well.
Nearly 1.8 million households had used the federal tax credits as of mid-February at a cost of $12.6 billion, according to the most recent records released by the Internal Revenue Service.
Some analysts said the first-time buyers credit helped new-home sales surge 27 percent last month compared with a record low in February. That was the biggest monthly increase in 47 years.
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