California Tax Credits Available to New-Home Buyers on a First Come First Serve Basis
March 20th, 2009 categories: Our Market
|
 CLTA Bulletin 08/09-91 – February 27, 2009 Governor Schwarzenegger signed a new law on February 20, 2009 to provide for a tax credit of up to $10,000 for the purchase of a newly constructed home. Senate Bill 15 of the Second Extraordinary Session (SBX2 15) benefits taxpayers who purchase a qualified principal residence on or after March 1, 2009, and before March 1, 2010. The total amount of credit available is one hundred million dollars and is available on a first come first serve basis.
The CLTA will be working with the Franchise Tax Board (FTB) and the California Escrow Association on the implementation of the program. The bill was one of several bill passed as the result of last minute budget negotiations. The CLTA will continue to provide information about the program to its members as it becomes available. The CLTA understands that the following FTB action is being contemplated: • The FTB will have a form that allows sellers to certify that eligible homes have never been occupied and buyers to declare their intention to occupy the eligible home as their principal residence for at least two consecutive years immediately following the purchase. The following conditions apply to the tax credit: • The qualified principal residence must be a single family residence, whether detached or attached, that has never been occupied • The credit is for the purchase of one qualified principal residence per taxpayer • The home must be occupied for at least two years immediately after the purchase and must be eligible for the homeowners property tax exemption • The credit is the lesser of 5% of the purchase price of the qualified principal residence or $10,000. The credit must be claimed in equal amounts over three consecutive tax years beginning with the tax year the purchase is made • The seller must provide a certification to the taxpayer and the Franchise Tax Board within one week of the sale that the qualified principal residence has never been occupied. Upon certification, the Franchise Tax Board will allocate the credit to the taxpayer on a first come, first serve basis. • To claim the credit, the taxpayer must submit with each tax return the certification by the seller.
|
