BOSTON HOMES BLOG

December data are down

— By: Marilyn Jackson

December home sales data reflect a slow market with soft prices, according to Timothy M. Warren Jr., CEO of the Warren Group, which publishes Banker & Tradesman. Its report was released Jan. 24. Home sales of single-family homes across the state dropped 5 percent in December in a year-over-year comparison, while condo sales dropped 15.75 [...]

City collects $9.4 million from non-profits

— By: Marilyn Jackson

The city has collected $9.4 million from non-profit, tax-exempt organizations for the first half of fiscal year 2012, a 24 percent increase from fiscal year 2011, Mayor Thomas M. Menino stated in a press release Friday. The city had requested $10.8 million. Guidelines for the PILOT or payment in lieu of taxes program were revised [...]

— By: Linda Goodspeed

Federal tax credit extended for homebuyers

 

 If you are a homeowner, or you want to be one, you have some good news. Earlier this month, Congress extended and significantly expanded the popular $8,000 first-time homebuyer tax credit.

 

The original credit, part of President Obama’s stimulus package, was due to expire Nov. 30, 2009. Congress has voted to extend the program until April 30, 2010.

The credit enables first-time buyers (defined as not having owned a primary residence in the past three years) to take a tax credit equal to 10 percent of the purchase price of a home, up to a maximum of $8,000.

To get the newly extended credit, buyers must sign a purchase-and-sale agreement before May 1, 2010, and close on the home before July 1, 2010.

Congress also greatly expanded the income limits for the program. Previously, the credit would begin to phase out at incomes over $75,000 for individuals and $150,000 for married couples.

Now, buyers can receive the full credit on incomes up to $125,000 for individuals and $220,000 for couples. The credit is available for the purchase of principal homes costing $800,000 or less.

In addition to extending the first-time buyer credit, Congress expanded the program to include people who already own homes.

Current owners, who have owned their home at least five years, can receive a $6,500 tax credit on the purchase of a replacement home. Again, the new home must be a principal residence and must be under agreement by May 1, 2010. Buyers must close on the home by July 1, 2010. The same income limits and purchase contract requirements apply.

For both programs, you must remain in the home for at least three years. Otherwise, you may have to pay back a portion of the credit.

Exceptions include death, selling the home as part of a divorce settlement, the home is destroyed by natural disaster or is subject to condemnation by eminent domain.

Finally, one more point of clarification. A tax credit is not a refund. A tax credit reduces dollar-for-dollar the amount of taxes you owe. So, an $8,000 tax credit, or a $6,500 tax credit, will reduce the amount of taxes you owe by those amounts.

 

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