Good news for the California real estate market today as Governor Arnold Schwarzenegger signed Assembly Bill 183 which 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. With the ending of federal tax credits and potential increases in the loan rates there is a growing fear that the recovery that we are currently seeing in the local real estate market will soon come to an end. The tax credits provided in AB 183 will help to mitigate those fears as it provides California home buyers with a tax credit of up to $10,000.
In essence AB 183 is an extension of the 2009 home buyer tax credit. However that credit only covered $100 million dollars, which was used up in only four months. AB 183 is also a first come first serve credit but with $200 million in credits we expect it to last closer to six months. Bottom line now is a good time to buy a new home as you can still lock in low interests and get up to $10,000 in tax credits while home prices are still low compared to just a few years ago.
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Tags: california real estate market, south bay real estate market, tax credits
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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.
At that time most people believe that it would be the same as IRS Credit for first time home owner.
I bought my first home and closed escrow account on 05/19/2010. My realtor as well as the escrow employees did not know about this 14 days limit to submit the application. No body told me about that until I visited FTB website on 06/07/2010. Even though, it was late 5 days, I faxed my application on that day. And my application was denied.
I believe it is unfair practice. It is unfair because it is not a first-come, first-served basis as the law said. I submitted application and bought a house first, but my application was denied because 14 day limit. Whereas, other homeowners bought a house after me and submitted application after mine, but their application were approved.
FTB should announce clearly and widely on radio, TV, not only on its website and should allow the time enough for the information reach the recipients.
FTB should do more and clear because normal people may assume it is the same as IRS. What do you think if the Right to speech have a limit “you cannot critize the government?” like Chinese communist? What a ridiculous bill!
If you visit this web site on 03/26/2010 you can see no info about 14 days limit law of FTB.
http://california.realestaterama.com/2010/03/26/governor-schwarzenegger-signs-10000-homebuyer-tax-credit-legislation-ID0583.html
FTB 14 days annoucement
http://www.ftb.ca.gov/individuals/new_home_credit.shtml?WT.mc_id=HP_Feature_HomeCredit_Hed
Replied from FTB
Thank you for visiting the FTB website.
AB 183 does establish a 14 day deadline to receive your application in Section 17059.1.c.1.A and also Section 17059.1.h. The 14 day deadline was an increase from the deadline for the 2009 New Home Credit which was 7 days. As for spreading information about the program there were articles in newspapers and television reports from beginning of March 2010. While all these would get the word out about the program it is the buyer responsibility to find out all the details of the program when they apply for it. The most important place we could put the 14 day deadline would be on the instructions for the application. The deadline is stated on the instructions for the application in several sections to make it clear as you fill out the application. The link you provided was just a published article not the actual bill, I have attached a copy of the bill for you to review.
Please visit our website again if we can assist you further.
My answer:
From: Tran, Lich D
Sent: Tuesday, January 25, 2011 6:53 AM
To: ‘WSCS.GEN’
Subject: RE: Homebuyer Tax credit unfair practice.
Dear Sir,
It was my error to complaint the FTB. I am very sorry.
Still, AB 183 is unfair and unethical assembly bill. It should be amended. I have filed my complaint to Attorney General, Governor, California Congress and also put the complaint to Internet, blogs, facebooks, twitter …. as much as I can. I also asked Senator and Assembly men in my district.
This unfair unethical law may contain “Reserving New Home Credit to benefit one specific group secretly.” It really is a wrong way to create a hostile environment for our society. How can we account for the fairness of a first-come, first-served basis?
Why did not reduce the amount so more people have access to the tax credit.? Why not $2000 for each?
Why was not based on Closing account Date for the first 10,000 application?
Why there was a too shot time of only two weeks? Not three months? Buying/selling a house is not the same as a car.
Thank you very much for your great service, it is not FTB false. It is the congress wrong doing.
Also I will use you your email to complaint my realtor and loan officers to BBB, FTC, and State Board because they email to encourage me to buy a house for $10,000 tax credit. And I relied on their message. But they failed to notify me the 14 days limit.
Respectfully,