Tax credit in California starts May 1st

May 6th, 2010 by Eric
Categories: News

Great stuff here for first time home buyers in California starting May 1st… $10,000 Tax Credit! Just like the one California did last year. Unlike the Federal $8,000 one where EVERYONE got it… it’s FIRST COME FIRST SERVE and there is only $100,000,000 dollar budget meaning 10,000 people will get it. Escrow MUST close before sending the application in. There is another $100,000,000 designated to NEW HOME CONSTRUCTION purchases…. And you DON’T have to be a first time home buyer for that one. Here is the link, but I highlighted details below. http://www.ftb.ca.gov/individuals/new_home_credit.shtml.

First Time Home Buyer

- Individual or spouse must not have owned a primary residence for minimum of 3 years

- The credit is 5% of the purchase price maximum of $10,000

- Buyer MUST submit application with a copy of the Final HUD via fax only, within 14 DAYS after COE or they will be denied

- Buyer can not submit application BEFORE COE or they will automatically be denied

- The seller must complete part of the application so make sure to have that completed before closing

- If you have ALREADY entered into a contract PRIOR to May 1st and the COE is on or after May 1st, they MAY qualify for the tax credit assuming the money had not run out (first come first served)

- Can be an SFR, Condo, Coop, Manufactured home, MOBILE home, House boat

New Home Construction

- Does NOT have to be a first time home buyer

- The credit is 5% of the purchase price maximum of $10,000

- Must go into contract ON or after May 1, 2010 and close by 12/31/2010 or until money runs out

- Buyer CAN RESERVE their tax credit as SOON as they go into escrow and submit the final application after COE (construction could take 4-6 months so this way they can reserve their spot before the money runs out)

- The seller must complete part of the application so make sure to have that completed before closing

- Can be an SFR, Condo, Coop, Manufactured home, MOBILE home, House boat

- If they are a first time home buyer they do not get BOTH credits

There are some stipulations how much of the $10,000 may be collected… because they cannot go below the tentative minimum tax, but that all depends on the buyers tax situation. If they are buying a $400k-$500k+ home… chances are they’ll be able to use the full credit. But if they don’t, it is not allowed to be carried over to the next tax year.

Bill T. Daniels
Certified Mortgage Coach
Mortgage Banker / Broker Associate
Jayco Capital Group – Direct Lender
1432 Edinger Suite 200
Tustin, CA 92780
714.834.9606 Tel
714.809.3706 Cell
714.784.7848 eFax
bill@billtdaniels.com

Tags: californa tax, credit, rax credit

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