New $1,800 Tax Credit for Georgia Home Buyers

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TaxCreditGood news if you’re thinking of buying real estate in Georgia…Governor Sonny Perdue signed House Bill 261 yesterday (May 11) providing an $1,800 tax credit on home purchases during the next six months.

The state tax credit, which would be taken over three years, takes effect on June 1, 2009 and is available on single family residences including condos and foreclosures. The amount of the credit is $1,800 or 1.2 percent of the purchase price, whichever is less. You can claim one-third of the credit available in each taxable year, and may carry forward unclaimed amounts.

Plus, there are no income restrictions and you don’t have to be a first time home buyer to receive the new $1,800 tax credit. It’s available to all buyers who close by Nov. 30, 2009. Find out more.

Federal Tax Credit vs. State Tax Credit

If you’re a first time home buyer, you may be eligible for the federal tax credit too – 10 percent of the purchase price of a home up to $8,000. The federal tax credit is available only to first time home buyers. However, keep in mind, the government defines a first time buyer as someone who has not owned their primary residence during the last three years, so you may still be eligible if you own an investment property.

To be eligible for the $8,000 tax credit, you must close on your home by Nov. 30, 2009 and not make more than $75,000 per year (as an individual) or $150,000 per year (as a married couple).

The $1,800 state tax credit is meant to spur activity in the housing market just like the $8,000 home buyer credit is doing. In fact, a preliminary report by the Treasury Inspector General for Tax Administration, which looks at 56.9 million tax returns received through March 6, revealed that 567,685 households claimed the tax credit. If those trends remain steady for all 140 million tax returns the IRS expects this year, about 1.4 million households will claim the first-time homebuyer tax credit in 2009.

All of this is great news for the housing market and the economy. This bill gives buyers an extra incentive to buy and reduces the amount of inventory of unsold homes – both are needed to help kick start the economy.

Other legislation passed

A two-year freeze on all property reassessments. This law gives homeowners protection during an economic strife by keeping property values from rising when the real estate market is down.

Questions / Thoughts?

If you have comments or questions about the new $1,800 tax credit or the $8,000 home buyer credit, write your comment below. You may also want to look at attending a seminar on these tax credits.

Copyright © 2009. Metro Brokers’ Blog. All rights reserved.
DISCLAIMER: This is NOT legal advice and should not be relied on as fact. This post contains my personal opinions and does not reflect the opinion of any organization I’m associated with. Consult an attorney in your state.

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31 Responses to “New $1,800 Tax Credit for Georgia Home Buyers”

  1. Dennis Doll Says:

    GREAT!

  2. Jamie Thompson Says:

    Great info. I am starting to read this blog everyday it’s so good!!

  3. Yvonne Thomas-Brooks Says:

    Wow! That is a fantastic opportunity! $8,000 + $1,800, lowest interest rates in years!!! A great time to buy, just got better!

  4. Monique Mills Says:

    The news just gets better everyday! I look forward to helping buyers take advantage of this opportunity!

  5. Terry Young Says:

    So what is everyone waiting for????

  6. Dana Eskridge Says:

    This program benefits everyone. It may even attract companies and buyers interested in moving to Georgia. I wonder how many other states offer tax credit incentives. This tax credit will also encourage those transferees who have been renting to become buyers in the next few months.

  7. Michael A. McFadden Says:

    Another tool

  8. Corey A Mason Says:

    The hits keep coming. There is no excuse. Buy now!!!!!!

  9. Carol D Says:

    If I am closing on a home May 29th, should I move the closing date to June 1st or would I still be eligible to take the tax credit if I close, per the contract, on May 29th?

    • Tisha Gay Says:

      I’m not a tax attorney, but I’ll do my best to point you in the right direction. I’ve received a variety of answers from different people, including the Governor’s office, who does not seem to know the answers to many of the questions I’ve posed today. They even sent out incorrect information in their initial press release to the media (they said the tax credit takes effect immediately when it really does not start until June 1).

      Before you postpone your closing, you’ll want to talk with your loan officer first and possibly a tax attorney. Make sure there are no stipulations in your contract or your loan that could prevent you from keeping the same rate, the same terms or more importantly…prevent you from closing altogether. I realize you want to take advantage of this new law if you can, but keep in mind, it’s a tax credit (not cash). I wouldn’t want to see you do anything to jeopardize your closing or stop you from getting a home you love. Let me know how it turns out.

    • Andy Says:

      My closing is on May 29th too :(…Does that mean I am not eligible….The selling agent was particular that they won’t delay my closing whatsover

      • Tisha Gay Says:

        Hi Andy – I had a similar question a few days ago (I’m guessing that is what you’re referring to)…check out my response to Carol D. Again, I’m not an attorney, but I’ll do my best to point you in the right direction. I’m not sure how much say that you, the selling agent or any party in your transaction has in delaying your transaction. When you sign a contract to purchase a home, it’s a legally binding contract. There are terms and conditions that may prevent you from delaying your closing without penalties or prevent you from closing altogether. In addition, your loan may have stipulations that could prevent you from keeping the same rate, same terms or prevent you from qualifying for the loan any longer. Before you postpone your closing, you’ll want to talk with your Realtor, loan officer and possibly an attorney.

        Since the tax credit does not go into effect until June 1, it does not appear that you would qualify. You may want to read over the details of the new house bill 261 with a tax attorney.

        I sympathize with your situation, but keep in mind, it’s a tax credit spread out over several years (not cash). I wouldn’t want to see you do anything to jeopardize your closing or stop you from getting a home you love. Let me know how it turns out.

  10. Charity Cason Says:

    The key: TELL PEOPLE ABOUT IT! Do not assume buyers are watching the news or reading the newspapers. You have to tell them about all of these great opportunities right now!

  11. Mark Broyles Says:

    It’s time for us agents to put the teeth in these Government hand outs. Washington and GA can pass a million buyer incentives. If we don’t get off our butts and make sure that everyone not only knows about it, but also understands it; then it will all be a waste. C’mon Agents who’s with me? I need some foot soldiers to go out and take the fight to the streets! Home buying is a face to face business. Get out there and spread the word. Guess I drank the Kool Aid!!

  12. Nancy Knight Says:

    Glad I inquired. I had an investor call me about it on Monday.
    He seemed to know a lot about it. Thanks to Judy Jones for pursuing this and getting info out to all agents

  13. sherri schaefer Says:

    sending email blast out now. As we all know this confirms
    another great reason to buy now.

  14. Michael J. Scott Says:

    I am proud that I was able to serve on the GAR committee that helped get this through the process. We tried for more, but in these times this is really good.

  15. Foreclosures – Are they right for you? « Metro Brokers Blog Says:

    […] In addition, you may qualify for the $8,000 Federal Tax Credit and the $1,800 Georgia Tax Credit. […]

  16. Donna N. Hogan Says:

    I’m glad I stayed in the game to share with my Buyers all of the benefits of buying in a time such a this! I’m confident there is more is to come. Great News!

  17. darith Says:

    looks like the house needs to be a foreclosure to qualify for state credit

    • Tyler Brenner Says:

      darith –

      Looking through the bill, it seems as if any home will qualify, as long as it has been or is on the market before June 1, 2009. That goes for foreclosures, resales and new homes 🙂

      I’ll be the first (but definitely not the last) to say that the language is really confusing in this bill. It’s way too short, and very vague in places. Let’s hope they give out some more info before the June 1 launch date.

      BTW, I would have really liked to see this go into place retroactively, I think that was a bad move on the legislators part.

  18. Home Loans Search Says:

    I found your blog on google and read a few of your other posts. I just added you to my Google News Reader. Keep up the good work. Look forward to reading more from you in the future.

  19. Scott Cosby Says:

    I am adding this article to the package I give my Buyers at closing. Its better than any closing gift I have given in the past. This is great!

  20. Phyllis Rodkin Says:

    It keeps getting better and better for buyers…..and us!

  21. ellis Says:

    Does this credit apply to purchasing short sales?

  22. LaTrina Clark Says:

    Homebuyers are able to claim the credit on all purchases that occur AFTER June 1, but the home being purchased must have been originally listed for sale PRIOR to June 1.

    I was just wondering how the above requirement would be regulated. After reading the attached HB261 Bill section – The buyers will need documentation and the listing agreements now include personal information from the original homeowner, have the commissioner decided that the MLS printout be sufficient? With all closing going forward, as Realtors® we will need to provide this information as closing.

    (d)(1) A taxpayer shall submit to the commissioner a bona fide listing agreement with a real estate agent or broker licensed in this state, documentation that the eligible single-family residence was for sale directly by the owner without a real estate agent or broker, or other appropriate documentation deemed sufficient by the commissioner to validate the eligiblity of the single-family residence for purposes of the tax credit under this Code section.

  23. James Thomas Says:

    To Whom It May Concern:

    This is not a comment but a question.

    Will House Bill 261, providing $1,800.00 tax credit for Georgia Home Buyers, extend the home closing deadline to 4/30/2010 to be in concert with the Federal Home Tax Credit program?

    James Thomas
    Lawrenceville, GA

  24. ann bone Says:

    Questions are coming in as to whether the state of Georgia has extended their $1,800 ITC beyond 12/31/09. No, not yet. I can’t even find any reference to proposed legislation to do so when the 2010 session opens in January.

    Buyers should not wait to see if this happens or not. Remember that homes must be under contract by April 30, 2010 and close no later than 6/30/10 to take advantage of the up to $8,000 ITC for first-time homebuyers and up to $6,500 for qualifying “move-up” buyers.

  25. jiang Says:

    My house closing day is Nov 30, But how can we know the house have been on list before May 11 or not?

    • ann bone Says:

      If you are saying that your closing date is in November of 2010, you are, unfortunately, too late to take advantage of the $1800 Georgia ITC. That benefit was for homes on the market by May 11, 2009 and closing before the end of 2009. Sorry.

      • jiang Says:

        My house has been closed in Nov.30 2009.
        My point is how to know the house has been on the market
        befpre May 11 2009.

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