Those buyers who close escrow on a primary residence that qualifies for the program sometime from May 1, 2010 through December 31, 2010 will be able to take advantage of the tax credit. Also, those who are in escrow on a primary residence that qualifies by December 31, 2010 and close before August 1, 2011, should be able to take the credit.
The amount of this tax credit should be equivalent to either five percent of the selling price or ten thousand dollars, whichever is less. The bill specifies that the buyers must occupy the house as their primary residence for at least 2 years, otherwise the credit shall be forfeited, and they shall be obligated to pay it back to the state. Purchasers must be a minimum of eighteen years of age and not be related to the seller of the property.
The bill defines a first time purchaser as someone who has not been a homeowner for the last 3 years.
This bill will provide two hundred million dollars for these tax credits, of which one hundred million will go to first time qualified purchasers of existing houses, and the remaining one million dollars will be available to those who buy new homes or those that have never been lived in.
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