Homebuyer Tax Credit Extension

In a move late on June 30th, the Senate decided to extend the closing deadline for the homebuyer tax credit, which was set to expire at Midnight on June 30th. The House of Representative had already signed the extension and now the document is awaiting President Obama’s signature, which is expected to come sometime next week. The document, titled the Homebuyer Assistance and Improvement Act of 2010, stipulates that any homebuyer who signed their sales contract prior to April 30, 2010 and closes before September 30th will qualify for the tax credit.

The original tax credit document was the American Recovery Reinvestment Act (signed February 2009) and gave first time homebuyers an $8,000 tax credit on their sale. Later in the year Congress decided to also enable a $6,500 tax credit for non-first time buyers.
The reason for this extension of the tax credit is that under the initial rules, many homebuyers who had signed their sales contract signed prior to April 30th were still in the process of closing as the June 30th deadline became imminent. The new September 30th deadline should allow enough time for most homebuyers to close their sales contracts and benefit from the tax credit.