I wrote a post yesterday at my www.Irina4RealEstate.com site about the new tax credit available to Californians who are purchasing new construction homes, condos or townhomes.
I am reposting it here to reach a wider audience since this is such an incredible opportunity and is only available on a first come, first served basis.
Also, it seems like not a lot of publicity was given to this tax credit by the state of California or the real estate community. So here we go…
$100 million has been allocated and is available on a first come, first served basis. So if you are thinking of buying one of the new Pasadena condo developments in or around the South Lake Avenue district like Granite Park or Lake at Walnut, make sure to take the opportunity to apply for this credit.
Here are the California tax credit rules:
- It is only available for NEW HOME PURCHASES.
- This tax credit is only available for qualified buyers who purchase a qualified residence between March 1, 2009 and March 1, 2010 and only until the tax credit allocated amount lasts.
- The property purchase must never have been occupied before, i.e. new construction!
- The buyer must reside in the new home for a minimum of two years immediately following the purchase date.
- Be eligible for the property tax homeowner’s exemption under California Revenue and Taxation Code Section 218.
California Tax credit amounts
California allocated $100,000,000 for this tax credit. Buyers must apply for credit allocation from us. Applications will be reviewed and credit allocations will be made on a first-come, first-served basis. Once $100,000,000 has been allocated, the tax credit will no longer be available.
Total credit allocated to date by California: $0
Remaining credit available: $100,000,000
To check how much Tax Credit Allocation is available, visit the Franchise Tax Board New Tax Credit for New Construction Home Buyers Page.
California allows qualified new home buyers a total tax credit amount equal to either five percent of the purchase price or $10,000, whichever is less. Taxpayers must apply the total tax credit in equal amounts over three successive taxable years (maximum of $3,333 per year) beginning with the taxable year (2009 or 2010) in which the new home is purchased.
How to apply
Within one week (seven calendar days) after the close of escrow:
- The seller must complete Part I of Form 3528-A, Application for New Home Credit, certifying that the home has never been occupied, and provide a copy to the buyer or escrow person.
- The buyer will complete Parts II & III of Form 3528-A.
- The escrow officer on behalf of the seller and buyer will fax the completed Form 3528-A to FTB at 916.845.9754, and provide a copy to the buyer.Fax is the only delivery method that will be accepted and considered for credit allocation by FTB (Franchise Tax Board), as the date and time stamp on the fax will determine the order in which credits are allocated.
- Fax only one completed application per residence with all qualified buyers listed. Do not include information on nonqualified buyers. An incomplete application may delay or prevent credit allocation.
- Do not fax the application to FTB before escrow closes.
- Do not fax the application to FTB more than once. We will process the applications in the order received as quickly as possible.
- Escrow companies should only send one application per fax transmission.
- The buyer keeps a copy of the completed Form 3528-A for their records.PLEASE NOTE, A HOME BUYER ONLY HAS 7 DAYS FROM THE CLOSE OF ESCROW TO FILE FOR THIS TAX CREDIT!!!!!!Don’t miss your opportunity to take advantage of this tax credit for new construction homes! Please call Irina at 626-629-8439 if you have any questions or feel free to email me.