First Homebuyer Tax Credit Can Apply to Backup Offers

In a question submitted to Inman News' "Homesale Hindsight," it is confirmed that backup offers that are submitted prior to April 30 can qualify for the first-time homebuyer tax credit, but that all depends on the wording of the contract.

In general, the backup contract applies for the credit, so long as it was actually executed by the seller on or before April 30. The IRS website states: "The Worker, Homeownership, and Business Assistance Act of 2009 extends the deadline for qualifying home purchases from Nov. 30, 2009, to April 30, 2010. Additionally, if a buyer enters into a binding contract by April 30, 2010, the buyer has until June 30, 2010, to settle on the purchase."

The specific verbiage of this binding agreement is key, so sellers should make certain with their real estate brokers, attorney and accountant that their contracts apply. In order for the agreement to be viewed as binding, both parties must have signed these agreements by the April 30 date.

Read more at Inman News.

photo credit: The-Lane-Team