Comparison of Federal and California Home Buyer Tax Credits
The buzz in the recent weeks around here for me has been about the newly resurrected California Tax Credit. It is certainly causing the fence sitters, who thought they did not have enough time to qualify for the Federal Tax Credit, to dive head first into the purchase market now they have more time to qualify for another program that is possibly worth more. HOWEVER, THERE IS A SMALL WINDOW OF OPPORTUNITY where a buyer may BE ABLE TO QUALIFY FOR A TOTAL OF $18,000 combined credit.
To take advantage of both tax credits, a first-time homebuyer must enter into a purchase contract for a principal residence before May 1, 2010, and close escrow between May 1, 2010 and June 30, 2010, inclusive. Buyers who are not first-time homebuyers may use the same timeframes to receive up to $16,500 in combined tax credits if they are long-time residents of their existing homes as permitted under federal law, and they purchase properties that have never been previously occupied as provided under California law. Please check with your tax professional for specific details.
The issue for the California Tax Credit is that it is limited to $200 Million in total, hence it the fund runs out before the deadlines, you will be left holding the bag like last year. First come First Served basis again.
Here is a quick side by side comparison to help clarify matters of concern.
