Henderson Home Buyer Tax Credit Extended, Expanded Las Vegas

The extension of the first-time Las Vegas homebuyer tax credit will help continue to clear out inventory, but expanding the credit to include more buyers may not be as helpful in high-cost housing areas. 702-307-4070

President Barack Obama recently signed legislation that extends the deadline on the first-time homebuyer tax credit and adds a smaller tax credit for move-up and other Henderson homebuyers.

The extension and expansion gives homebuyers a tax incentive to buy a home until at least April 30, 2010 — April 30, 2011 for qualifying military personnel. The previous deadline was just weeks away, November 30, 2009.

“The extension of the first-time home buyer tax credit will be crucial to clearing out unsold inventory and especially the lagging bank owned inventory that has not even hit the market yet,” said Steve Wadkins of ReMax Associates Henderson Nevada.

That’s true of many housing markets.

The existing tax credit for first-time homebuyers remains at a maximum $8,000.

A new tax credit of up to $6,500 is available to qualifying existing homeowners who buy a new primary residence (or have one built) by April 30, 2010, if they owned their existing home for five consecutive years over the last eight years. Second homes don’t qualify for the credit. www.WadkinsHomeTeam.com  

Las Vegas Home buyers have to repay the credit if they live in their primary residence less than 36 months and are not members of the military.

The new rule also raises the qualifying income limits to $125,000 for single taxpayers and $225,000 for joint taxpayers, from the current $75,000 and $150,000. www.WadkinsHomeTeam.com

The maximum allowed home purchase price is $800,000, which won’t be as useful to move-up buyers in high-cost areas.

Both first-time Henderson home buyers and others must contract to buy a home by April 30, but close escrow by June 30, 2010. To search for Las Vegas Home or Henderson Hom or Summerlin Home www.WadkinsHomeTeam.com  

Buyers can claim the credit on their 2009 taxes, even if the purchase is made in 2010 by filing an amended return.

Steve Wadkins said “This will also assist in selling the short sale inventory that those buyers were afraid to consider because of the time frame involved in closing them when they were on this deadline to close by the end of the month (November).”

Buyers who don’t owe taxes can have the credit refunded to them as a rebate.

More information is available from the Internal Revenue Service (IRS}, including a question and answer page.

It’s all good news for the housing market.

The National Association of Realtors says as many as 400,000 resale transactions (1.2 million for both new and resale homes) were completed specifically because of the first-time home buyer tax credit, since it began, and that put a dent in the housing inventory.

The first-time home buyer tax credit’s availability has coincided with mortgage rates often hanging below 5 percent, according to Gerri Wadkins of Wadkins Home Team ReMax Associates.

Tax credit history

The new legislation includes provisions to stifle fraud after the Internal Revenue Service identified 167 suspected criminal schemes and opened nearly 107,000 examinations of potential civil violations of the first-time homebuyer tax credit.

Cheating the IRS is a federal felony that comes with a fine of up to $250,000 and three years in a federal pen, or both.

To combat fraud, a HUD-1 Settlement Statement will have to be attached to the tax return to secure the credit.

To search or Buy a Home www.WadkinsHomeTeam.com

To Short Sale Your Home: www.VegasShortSaleHomes.com

Steve & Gerri Wadkins® Realtors Advanced CDPE

702-307-4070