More Homebuyer Tax Credits, Courtesy of California

California may be broke but our legislators  are working hard to give away tax credits to first time buyers and purchasers of never lived in homes.  This is being done in order to stimulate the housing and construction industries.   Governor Schwartzenegger  signed into effect a law on March 25, 2010 that will run alongside the federal government’s soon to expire (4-30-10) current $8,000 first time homebuyer and $6500 long time resident homebuyer tax credits.

Under the combined state and federal provisions, a first time buyer who enters into a purchase contract for a principal residence before May 1, 2010 and closes escrow between May 1, 2010 and June 30, 2010, inclusive are eligible for up to $18,000 in combined tax credits.  Home buyers who are not first time buyers but have lived in their residences for awhile may also take advantage of up to $16,500 combined tax credit if they purchase a home that has never been lived in.  Federal benefit is up to $6,500 and California is up to $10,000.

The timing is critical on both of these programs.  Also, California has a limit of $100 million in credits to be given to each program (first time buyer and new home buyer).