$8,000 Tax Credit Extended and a New "Step-Up" Tax Credit Initiated

First-time Homebuyers
The measure will extend the first-time homebuyer tax credit until April 30, 2010. In addition, those who have signed a contract before May 1, 2010 will have 60 days to close on the home. Increases the income limits to $125,000 on a single return and $225,000 on a joint return (from $75,000 and $150,000, respectively). Those who purchase in 2010 will be able to claim credit on 2009 tax return. Definition of first-time buyer remains the same as those who have not owned a home in the last three years. The credit will remain at $8,000.

Step-up Buyers
Those who have owned the same home for 5 consecutive of the last 8 years will be eligible for a $6,500 tax credit. The $6,500 tax credit will be eligible for purchases between December 1, 2009 and May 1, 2010 and will have 60 days to close on the home. The income limits are also $125,000 on a single return and $225,000 on a joint return and have a $20,000 phase-out thereafter. Those who purchase in 2010 will be able to claim the credit on 2009 tax return.