Today’s post is a guest post by James Kelley, of the VA Benefits Blog. James has good news for some veterans among my readership…
Most home buyers who were under contract by April 30 have from June 30th to September 30th to close on their home in order to get the $6,500-$8,000 federal tax credit. And financing options, like federally subsidized VA loans, have become harder and harder to get during the lending crisis. For many, it doesn’t look too good. But if you are in the United States military and served on official extended duty between Jan. 1, 2009 and May 1, 2010, the news is still good on your end.
Those serving overseas were at a disadvantage to find a home by April 30th, so the federal government extended the homebuyers tax credit specifically for military men and women for another year. Which means that if you or your spouse were serving abroad between those dates, you have until April 30, 2011 to find a home and enter into a binding contract in order to receive the credit.
Keep in mind that the first-time home buyer credit is for up to $8,000 or 10 percent of the home price (obviously whichever is less is the credit you will receive). If you are not a first-time home buyer, there is a credit for existing home buyers, which is up to $6,500.
If you hope to be considered as a first-time home buyer, you or your spouse cannot have owned a home within the past three months. So if you meet that requirement and served overseas during that period (Jan. 1, 2009 and May 1, 2010), there are still just a few more requirements that you must meet in order to receive the credit:
• Your service overseas must have been for at least 90 days between the above dates.
• If you’re married and file jointly, your income cannot be more than $225,000 per year, and if you are not married, then your income cannot be more than $125,000 per year.
• The home you want to purchase cannot cost more than $800,000.
• After you find the home you want to buy, you have to be under contract by April 30, 2011 and the closing must take place by June 30, 2011.
Don’t forget that you can use your VA home loan benefit to purchase your house and still get the tax credit.