First Time Home Buyer Tax Credit Extended For Military Members

The first-time home buyer and repeat tax credits expired on April 30, 2010, but if you have not taken advantage of the credit and you are a member of the military you may be in luck, as Congress has extended the credit for another year for some military personnel.  You may still be able to take advantage of historically low mortgage rates and low home prices.

From IRS.gov, here are the guidelines for qualification for the tax credit.  For the complete rules, click here:

• Members of the military and certain other federal employees serving outside the U.S. have an extra year to buy a principal residence in the U.S. and qualify for the credit. Thus, an eligible taxpayer must buy, or enter into a binding contract to buy, a principal residence on or before April 30, 2011. If a binding contract is entered into by that date, the taxpayer has until June 30, 2011, to close on the purchase. Members of the uniformed services, members of the Foreign Service and employees of the intelligence community are eligible for this special rule. It applies to any individual (and, if married, the individual’s spouse) who serves on qualified official extended duty service outside of the United States for at least 90 days during the period beginning after Dec. 31, 2008, and ending before May 1, 2010.

• In many cases, the credit repayment (recapture) requirement is waived for members of the uniformed services, members of the Foreign Service and employees of the intelligence community. This relief applies where a home is sold or stops being the taxpayer’s principal residence after Dec. 31, 2008, in connection with government orders received by the individual (or the individual’s spouse) for qualified official extended duty service. The credit is still allowable even if this happens during the year of purchase. Qualified official extended duty is any period of extended duty while serving at a place of duty at least 50 miles away from the taxpayer’s principal residence (whether inside or outside the U.S.) or while residing under government orders in government quarters. Extended duty is defined as any period of duty pursuant to a call or order to such duty for a period in excess of 90 days or for an indefinite period.

So if you are returning home from serving abroad, or are currently abroad and have a spouse at home, you may still be able to save big on a new home purchase.  Demand for homes has tailed of substantially since the tax credit expired, so it is definitely a buyer’s market right now, and you have until April 30, 2011 to claim the tax credit.  For more information, call one of our mortgage experts at 877-868-2509.