Whether it’s purchasing a starter home or trading up for something larger, area residents still have the opportunity to take advantage of special tax breaks.

However, the home has to be under contract by April 30, and the deal has to close before June 30 to take advantage of thousands of dollars in tax credits.

First-time homebuyer tax credits were created in the stimulus package, then extended and expanded to include existing homeowners in the Worker, Home ownership and Business Assistance Act of 2009, signed into law in November.

It provides for qualified homebuyers to receive up to an $8,000 tax credit if they are first-time buyers purchasing a principal residence, and a tax credit of up to $6,500 for repeat homebuyers.

Local Realtors continue to rally behind this selling point.

“I applaud Congress and the Administration for the passage of the ‘Worker, Homeownership and Business Assistance Act of 2009,’” said Coldwell Banker Preferred Properties of N.C. Broker/Owner Debra Parsons. “The National Association of Realtors recently reported that 47 percent of 2009 home sales were to first-time homebuyers, so clearly the initial tax credit worked.”

She added there are more existing homeowners considering buying a home now than six months ago.

Exit Realty Broker/Owner Nicole Hayden said first-time homebuyers have taken a back seat to existing homeowners in Richmond County, who seem more willing to wheel and deal.

“Right now, we’ve got more move-up buyers,” she said Tuesday. “Since the tax credit was extended to existing homeowners, we’ve had quite a few of them sell their home and buy a new one.”

She said the bulk of the Richmond County buyers and sellers she’s worked with have qualified.

“We’ve had a lot of home buyers that are moving into a bigger house, but we’ve even had some older homeowners who are retiring and want to down-size into a smaller home,” Hayden said.

However, she said that working with lenders has been more difficult since the onset of the recession, and deals are typically taking 45 days or more to close.

“They should come on in to take advantage of these tax credits, because if they wait until April they may not be able to get them,” she concluded.

According to the IRS, these tax credits will either reduce a taxpayer’s bill or increase their refund, “dollar for dollar.”

The National Association of Home Builders launched the Web site www.federalhousingtaxcredit.com to explain the process to consumers.

Included in its pages are frequently asked questions pages on both varieties of tax credits being used as an incentive to draw customers into the market.

There are also special rules that apply to members of the military, the foreign service and the intelligence community.

These extend the credit to service members who have technically not owned their home long enough to qualify for the existing homeowner tax credit, and extends the deadline for a year to those on a period of extended official duty.

Staff Writer Philip D. Brown can be reached at (910) 997-3111 ext. 32, or by e-mail at pbrown@yourdailyjournal.com.