Calif., Fla. Led in Homebuyer Tax Credits Claimed in FY 2009

UPDATED: April 4, 2010: 
U.S. Treasury Officials today reminded potential first-time and repeat homebuyers that they have until April 30 to take advantage of up to $8,000 in tax credits that have already helped 1.8 million taxpayers.

“This tax credit has helped put money back into the pockets of Americans at a time when they need it most, and it has played a significant role in the Administration’s efforts to stabilize the housing market and the economy as a whole,” said Deputy Treasury Secretary Neal S. Wolin.

Overall, nearly 1.8 million taxpayers have collected $12.6 billion in tax credits to buy a home, due largely to the Recovery Act, the Treasury said.

(See related article: IRS: Don’t Overlook Recovery Act Tax Credits)

During the first nine months of 2009, there were 479,622 claims filed and granted for the first-time homebuyer tax credit, led by California, Florida and Texas, reported the Internal Revenue Service in its newly-released data book for fiscal year 2009.

The claims during that period amounted to $3.58 billion in credits, the IRS data shows.

California and Florida, two of the hardest hit states in the ongoing foreclosure crisis, accounted for 22 percent, or nearly one quarter, of the total first-time homebuyer tax credits.  A record rate of home value devaluations throughout parts of the two states during 2009 likely contributed to a surge in bargain-price hunting by first-time home buyers.

Conspicuously low on the list, though, is Nevada, where foreclosures have devastated the housing market, causing prices to plunge in certain areas, particularly the Las Vegas-Clark County region. Nevada ranked 24^th with 7,150 first-time homebuyer tax credits filed, the IRS reported.

Nevada has ranked first in the nation for the 38th month in a row in the number of foreclosure filings, reported RealtyTrac this past week.

The top five states with the number of first-time homebuyer tax credits claimed were:  California (58,179); Florida (45,992); Texas (42,436); Michigan (22,432); and Georgia (18,949).

In November, the homebuyer tax credit program was extended and expanded.

The program was extended by five months — until April 30, 2010. The credit can also be claimed if a binding contract before May 1, 2010 was signed to purchase the property before July 1, 2010. The credit is worth up to $8,000 for eligible first-time home buyers.

But long-time residents looking for a replacement primary home can also claim a tax credit worth up to $6,500 if certain conditions are met. The primary requirement is that a homebuyer must have lived in the same home, which served as the primary residence, for a five-consecutive-year period in the eight years ending with the purchase of the new residence.

Click here for the IRS homebuyer tax credit webpage.