Just as one government homebuyer tax credit program ends, another begins.
The homebuyer tax credit signed into law in March by Gov. Arnold Schwarzenegger is now available.
Assembly Bill 183 established a tax credit of $10,000 or 5 percent of the purchase price of a newly built home and a $10,000 tax credit for first-time purchasers of existing homes.
The credit is good through Dec. 31, or until funding is exhausted, whichever comes first.
The $200 million allocated for the program is split evenly, with $100 million going to purchasers of new homes and $100 million to first-time buyers of existing homes.
AB 183 was co-authored by Assemblywoman Anna Caballero, D-Salinas, and state Sen. Roy Ashburn, R-Bakersfield.
More information on the state tax credits can be viewed at www.ftb.ca.gov/individuals/new_home_credit.shtml.
The state program is kicking in just as federal homebuyer tax credits end.
Congress included the temporary tax credits in the economic stimulus package signed into law shortly after President Barack Obama took office last year. Lawmakers, after intense lobbying from the real estate industry last fall, extended it until Friday.
Homebuyers who had signed contracts in hand by Friday's deadline have until June 30 to complete their deals, and according to state officials, can also take advantage of both tax credit programs up to that time - a potential tax credit boost of up to $18,000.
The federal government offered buyers who haven't owned a home for three years a tax credit of 10 percent of the purchase price, up to $8,000. Single buyers with incomes above $145,000 and couples making more than $245,000 were not eligible.
The federal program also offered a credit of 10 percent, up to a maximum of $6,500, for buyers who already owned a home for at least five years, with the same income limits applying.
Nearly 1.8 million households had used the federal tax credits as of mid-February at a cost of $12.6 billion, according to the most recent records released by the Internal Revenue Service.
Some analysts said the first-time buyers credit helped new-home sales surge 27 percent last month compared with a record low in February. That was the biggest monthly increase in 47 years.
--Call The Sacramento Bee's Jim Wasserman, (916) 321-1102 or email him at [email protected]. Read his blog on real estate, Home Front, at www.sacbee.com/blogs.