First, here are the specifics about that deadline. Buyers must enter into a valid, signed contract by April 30th 2010 at the latest. Then, they have until June 30th to close escrow. For those in the military services, Foreign Service or those who work for the intelligence community, who have been on extended duty abroad for a minimum of ninety days during the time between January 1st, 2009 and April 30th 2010, the deadline extends by one year to April 30th 2011.
The purchaser of a home may keep their present home in order to fit the qualifications for the $6,500 "move up" so long as they use the newly purchased home as their primary residence. The tax payer must live in their new home as their primary residence for a minimum of thirty-six months or they must pay the credit back to the government.
At present, both spouses have to be eligible for the first time purchaser credit of $8,000 or for the "move-up" buyer credit of $6,500, whether they file their income taxes jointly or separately. If the couple is unmarried, only one of them needs to qualify. This may be changed very soon by a bill introduced into the House of Representatives that allows the married couple to have only one of them qualified in order to claim the credit.
When the eligible home purchaser files their income tax return, they may claim the tax credit. If they have already filed, they may file an amendment. The taxpayer completes IRS Form 5405 and attaches a copy of the Settlement Statement, which is usually a correctly filled out Form HUD-1.
