As I promised a couple weeks ago when talking about the proposed Georgia homebuyer tax credit, I did say that I would keep you updated.
After the House overwhelmingly passed HB 261, the bill moved onto the Senate. With such robust support, you’d think this is a slam-dunk. Almost. The Senate overwhelmingly passed it as well, but with a couple modifications. Can’t be a good politician without making changes.
It then went back and forth with the House and Senate acting like politicians and not getting along. A modified version was passed on Friday in the last session and now awaits the governor’s signature. The final version that passed reduced the tax credit to a maximum amount of $1,800, but did include condos which was not in the original House bill.
But here is the current HB 261 bill in a nutshell:
1. The tax credit applies to single-family homes and condos if purchased as your primary residence.
2. The property must be for sale prior to the effective date and still for sale after the effective date, or
3. The property must be in default on or before March 1, 2009 or has already been foreclosed and is held by the mortgagor
4. On the first day of the month after the effective date of the law, the purchase of a home meeting the criteria above within the next six months would be eligible for the tax credit.
5. The tax credit is limited to 1.2% of the purchase price or $1,800, whichever is less.
6. Now the tricky part. You can only claim, at most, one third of the tax credit in any one year, beginning with your 2009 tax return.
7. One final important caveat. If you’re purchasing a home, be sure to request a copy of the necessary documents to maintain for your tax records to document how the home qualified for the tax credit, whether it be because it was listed prior to the effective date or perhaps because it was delinquent or had been foreclosed.
This Act shall become effective upon its approval by the Governor or upon its becoming law without such approval.Will Sonny sign it, I’m not 100% sure about that. We’ll just have to wait and see.
Needless to say, if you’re interested in purchasing a Smyrna Vinings home, this is yet another great incentive that can be added on to the $8,000 federal first-time homebuyer tax credit. And if you’re thinking about selling your Smyrna Vinings home, don’t delay getting your home on the market in order to qualify.
If you have any questions (because I’m sure it’s clear as mud) or want to take advantage of this Georgia home buyer tax credit, be sure to contact us.
[tags]home buyer tax credit, Smyrna real estate, Vinings real estate[/tags]
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Just came across your site, great articles here. Thank You
-Brad
So, if I purchased a new home (new construction) around March 22(almost a month ago)
do I qualify for this credit? And, has Sonny already signed this bill?
Has the status of this bill changed? Today is April 18,2009.
Thanks in advance,
John
No, you would not qualify. The bill is not retroactive and has not been signed yet. Still unknown if Perdue will sign it or veto it.
Today is April 24, 2009. I will close on a home at the end of April. Do I still have a chance to qualify for this credit?
Thanks in advance!
The bill takes effect for purchases as of the 1st of the month for purchases in the subsequent six month period. So, for example, if the governor were to sign the bill today, it would be effective for purchases starting on May 1st. And that would be the earliest, since we’re in April and the governor has not signed the bill yet.
Thanks for the question.
Thank you very much for the answer.
Yes, I had thought that I would miss this credit, but wanted to get the confirmation from an expert like you. Thanks again.
From my own house purchase experience, the local market consists of two types of properties: houses priced correctly and sold fast; houses that stay on the market forever. For the first type of houses, sometimes there is a bidding war and serious home buyers have to act decisively and promptly to secure the deal. Definitely they don’t need any extra incentives from the state government.
Given that the governor hasn’t signed the bill yet, I do think Perdue is trying to save this “last bullet” for the second type of houses on the market.
I apologize for this lengthy comment. Thanks again for your reply.
Daniel
That’s a pretty fair assessment of the market. The key is to understand which properties are priced aggressively and will sell quickly with multiple offers. In terms of the Georgia tax credit, the point you make is probably why the governor hasn’t signed it yet. The thought is that it would increase home sales slightly, but the payment would be on all the homes sold during the qualifying period, which kind of warps the cost/benefit of the program.