11-2-2009, I regret to report that my source for this legislation was incorrect. I typically look for two sources, in this case one was verbal and the other a news blog. I apologize for my error. The bill is still under review and in negotiation.

US NEWS reports that the Tax Credit for 1^st time home buyers has been extended and expanded! (Subject to President Obama’s signature)

First time home buyers will be eligible for the tax credit as long sign a purchase contract by April 30, 2010 and close on the property before June 30, 2010.

The income ceiling for the tax credit has also been expanded. Before the extension, a single buyer’s income was capped at $75,000 and a married couple capped at $150,000. The expansion moves the income up to $125,000 and $225,000 respectively.

You can still get the tax credit as long as you purchase a home costing more than $800,000. You must also live in the property for three years or the tax credit will have to be repaid.

I guess the hot fudge on this Ice Cream Sundae is that you can buy in 2010, but apply the rebate to your 2010 income tax return. You will need this form to get things going on your refund.

The cherry-on-top is that a tax credit of $6,500 is now extended to move-up buyers; those homeowners who have lived in their current residence for five years are also eligible for a tax rebate.

This will stimulate those who want to take advantage of the historically low interest rates and housing inventory to move their families into larger homes. This link shows a great summary of the benefits and opinions regarding the legislation. Be aware that the dates and dollar amounts have been changed with the new legislation.

Those move-up buyers who might have to take a hit on lower value on their homes will get the benefit of $6,500 to ease the pain. Combine that with some seller-paid closing costs and a great FHA loan and you could be sitting in your family room next to the fire place in time for the Super Bowl!

Add an ice cream sundae bar to the party and you are living the American Dream!