Berkshire Tax Resolution would like you to know that the first-time home buyer’s credit has been extended into 2010, and more people will qualify for a tax break.  The qualification period for first-time home buyers to purchase a home and qualify for the credit will continue through April 30, 2010.  Berkshire Tax Resolution sheds light on the fact that first-time home buyers who have not owned a principle residence for 3 years prior to the purchase of a new home will continue to be eligible for a credit of up to $8,000.  For homes purchased after December 31, 2008, the credit will not have to be repaid if the home buyer uses the home as their principal residence for 3 or more years.  Those serving in the military will not be penalized if they claimed the credit and then have to deploy and sell their home within three years, explains Berkshire Tax Resolution. 

Berkshire Tax Resolution points out that the first-time home buyer’s credit has been expanded so that more homeowners now qualify for a tax break.  Berkshire Tax Resolution would like you to be aware of the fact that people who have owned a home and used it as a principal residence for a 5-consecutive-year period during the 8-year period ending on the date of purchase of a new personal residence may qualify as first-time homebuyers and receive a credit of up to $6,500.  To claim this credit, the taxpayer must have a signed purchase contract for a principal residence in force before may 1, 2010 and must close on their home purchase by June 30, 2010 (this also applies to the up to $8,000 credit). Berkshire Tax Resolution clarifies that this credit is available for purchases of principal residents after November 6, 2009.  Taxpayers who make qualified purchases after December 31, 2008 do not have to repay the amount of the credit if they reside in the home as their principal residence for 36 months after the purchase, explains Berkshire Tax Resolution.

For eligible property placed in service during 2009 and 2010 you can claim a credit of up to $1,500 of the cost of certain energy efficient property. Berkshire Tax Resolution would like you to know that the residential energy credit may offer a tax break on a 2009 return if all installation is done and/or work was completed in 2009.  Residential energy credits apply to homes, houseboats, mobile homes, condominium, and qualifying manufactured homes. Berkshire Tax Resolution explains that the credit is for 2009 and 2010 and the maximum credit amount is $1,500 for both years.

Berkshire Tax Resolution would like to inform you that those homeowners experiencing “short sales” and foreclosures will get an extended break for “debt-forgiveness” tax consequences.  Instead of treating cancellation of debt as taxable income on the foreclosure of a principle home, no taxes will be levied on discharges of indebtedness of up to $2 million dollars for married taxpayers filing jointly and of up to $1 million dollars for a married taxpayer filing a separate return through tax year 2012, clarifies Berkshire Tax Resolution. Homeowners who are not able to itemize deductions can deduct their real estate taxes as an additional standard deduction of up to $500 ($1,000 if MFJ) for tax year 2009.

Berkshire Tax Resolution would like you to be aware that a home seller who is a single taxpayer has the opportunity to owe no tax on the first $250,000 of profit for the sale of a home owned and lived in for two of the last five years.  A married couple owes no taxes on the first $500,000 of profit for the same time period.  Homeowners reap annual tax benefits from the deductions allowed for mortgage interest and itemizing, which is usually more beneficial than taking the standard deduction.  Berkshire Tax Resolution would like you to understand that when a main residence is sold after the death of a spouse, it must be sold within two years of the death date of death for the surviving spouse to claim the $500,000 exclusion.

The “worker, homeownership and business assistance act of 2009 provided a 14 week extension of unemployment benefits, and six additional weeks of unemployment benefits for those in states with unemployment rates of 8.5 % or more. Berkshire Tax Resolution explains that there’s no extension or increase in the provision for out-of-work Americans to exclude any more than $2,400 of unemployment benefits from total gross income in 2009. (This measure was a part of the American Recovery And Reinvestment Act Of 2009).