Hidden in the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, signed by the President on Friday, was a provision extending the $5,000 tax credit for first-time homebuyers in DC for another 2 years. The tax credit had expired at the end of 2009 and was renewed for 2010 and 2011.
The Federal tax credit is a $5,000 below-the-line credit against federal taxes for the purchase of a home in DC for taxpayers that did not own a principal residence in DC during the previous year. As happened this year, the credit usually expires and is renewed retroactively at the end of the year, leaving homebuyers a period of uncertainty about the tax ramifications of their purchase. The credit was tucked into the tax deal extending tax rates across the board to their current levels. The nationwide $8,000 tax credit for purchasing a home expired last summer.
Washington DC real estate development news
2 comments:
What is the income limit?
The maximum credit is for $5,000, or $2,500 if married filing separately. The credit begins to phase out when the modified adjusted gross income exceeds $70,000 ($110,000 if married filing jointly) and ends at $90,000 ($130,000 if married filing jointly).
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