Governor Signs Home Tax Credit Bill For 2010
By · May 10, 2010
Governor Schwarzenegger signed AB 183 providing $200 million for home buyer tax credits. The bill allocates $100 million for qualified first-time home buyers who purchase existing homes and $100 million for purchasers of new, or previously unoccupied, homes.
Eligible taxpayers who close escrow on qualified principal residences between May 1, 2010 and December, 31, 2010, or who close escrow on a qualified principal residence on and after December 31, 2010 and before August 1, 2011, pursuant to an enforceable contract executed on or before December 31, 2010, will be able to take the allowed tax credit. This credit is equal to the lesser of 5 percent of the purchase price or $10,000, taken in equal installments over three consecutive years. Under the bill, purchasers will be required to live in the home as their principal residence for at least two years or forfeit the credit (i.e. repay it to the state). Buyers also must be at least 18 years old and be unrelated to the seller. First-time buyers are defined as those who have not owned a home in the past three years.
To learn more about the California Home Buyer Tax Credit, click here.
If you missed out on the Federal tax credit for buying a home and getting into escrow by April 30, 2010 and closing escrow by June 30, 2010, you have another chance with the State of California. While this credit is a bit different, you can still receive tax credits up to a total of $10,000 over 3 years but only if you are a first-time home buyer.
If you were lucky enough to be in escrow before April 30 and closed escrow after May 1 but before June 30, 2010, you qualified for both tax credits. That would be a total of up to $18,000!