Congress voted Thursday afternoon November 5, 2009 to extend the $8,000 First-time Homebuyer Tax Credit and created an additional $6,500 credit for existing property owners looking to sell their home and buy another.

The tax credit for both programs (first-time homebuyers and existing homeowners) will apply to all written binding contracts in effect by April 30, 2010 and closed by July 1, 2010.

NAR has provided this chart to easily explain the restrictions of both credits:

NON FIRST-TIME HOME BUYERS who have owned their current residence for 5 of the previous 8 years are eligible for $6,500 when they purchase a new primary residence. The income limit is $125,000 for single buyers and $250,000 for married buyers filing jointly or $3250 for married buyers filing seperately. This tax credit is only applicable only for single-family primary residences under $800,000, not investment properties.

FIRST TIME HOME BUYERS or anyone who has not owned a property for the past three years is eligible for this tax credit which is 10% of the property value up to $8000. The income limit is $75,000 for single buyers and $150,000 for married buyers. If married buyers are filing separately then they are only eligible for a $4000 tax credit. There is no purchase price limit for buyers using this tax credit