Legislation
The Homebuyer Assistance and Improvement Act of 2010, P.L. 111-198, was enacted on July 2. The act extends the closing date deadline to qualify for the first-time homebuyer credit from June 30, 2010, to September 30, 2010. To offset the cost of the extension, the act also includes a provision that extends the bad check penalties the IRS can impose under Sec. 6657 to electronic payments.
Sec. 36 allows a tax credit of up to $8,000 for first-time homebuyers and a credit of up to $6,500 for long-term residents of the same principal residence. However, under Sec. 36 (before amendment), the credit was available only to qualifying homebuyers who bought a principal residence on or after April 9, 2008, and on or before April 30, 2010, or who entered into a written binding contract on or before April 30, 2010, to close on the purchase of a principal residence on or before June 30, 2010. Because of delays due to a number of reasons largely outside their control, many qualifying homebuyers who entered into binding contracts on or before April 30 were unable to close on their residences by the original June 30 deadline. The act extends the deadline for closing to September 30 (but it does not change the April 30, 2010, contract deadline).
In a news release (IR-2010-80), the IRS reminded taxpayers that special filing and documentation requirements apply to anyone claiming the homebuyer credit. The news release lists these requirements.
