AB 183 was passed by the legislature on March 22 and gives the Franchise Tax Board authority to extend a total of $200 million in tax credits to California homebuyers; $100 million for buyers of new, unoccupied homes and another $100 million for first-time buyers of existing homes. The credit will be extended from May 1, 2010 to December 31, 2010. The tax credit will be available to buyers on a first-come, first-served basis and is applied in equal amounts over a period of three taxable years. To qualify, the buyer must not be a dependent and must purchase a home that does not belong to a relative.
Governor Schwarzenegger fought hard to extend and expand the homebuyer tax credit after its successful run in 2009. That $100 million tax credit, which was approved in February 2009, ran out after just four months with 10,659 Californians claiming the credit – increasing home purchases, jumpstarting building projects and boosting local economies. In fact, La Ventana Homes saw a 300 percent increase in sales when the tax credit went into effect.
The homebuyer tax credit is a part of the larger California Jobs Initiative that the Governor proposed in his State of the State address in January to create jobs and stimulate the economy. This bill is the second piece of it to be approved by the legislature. A sales tax exemption on green-tech manufacturing equipment was also approved to encourage green businesses to relocate and invest in California.
For more information contact Robert Prophet and the Robert Prophet Group. Send us an email or visit our web site: RobertProphet.com
