The homebuyer tax credit has been extended in California. Governor Schwazenegger signed the bill providing $200 million dollars in home buyer tax credits.
The bill provides $100 million for first-time home buyer who buy existing homes and $100 million for home buyers who buy new or previously unoccupied homes.
To qualify you must close escrow between May 1 and December 31, 2010. Or, if you were under contract on or prior to December 31, 2010, you still qualify if it is your principal residence on or after December 31, 2010 or before August 1, 2011.
The amount of the tax credit is equal to the lesser of 5% of the purchase price, or $10,000, whichever is less and is a credit against tax, taken in three equal amounts over three consecutive years.
Purchases must live in the home as their principal residence for a minimum of two years or forfeit the credit. It will have to be repaid to the state.
This is an arms-length transaction and the buyer cannot be related to the seller. Also, the minimum age of the buyer is 18.
The definition of first-time buyer is someone who has not owned a property in three years.
If you are buying a home in Los Angeles, then now is definitely a good time to buy.