In my previous blog, I referenced that the California Association of Realtors (CAR) forecasted that the Franchise Tax Board (FTB) credit of $10,000 will expire in 10 to 20 days. Well, as of the 25th day of May, it has not run out. This is because FTB is calculating that only 57% of the applicants will qualify for the credit. Unlike the Federal Program that’ll give you back $8,000 regardless of the amount of tax you pay to the IRS, the FTB credit is only an off-set against the amount you pay to the FTB. So, unless you pay atleast $3,333 to the FTB annually, you will not fully benefit from the maximum amount of the tax credit. Also, FTB is thinking some people will not qualify for the program for one reason or another.
The total tax credit is $100 million and assuming everybody who applies can get the $10,000 total–that means the first 10,000 applicants will get the credit. But with the reduction to 57%, that means a total of 17,543 should be the cut-off point–with no saying how much each of the 17,543 can get or can’t get. The order of entry is determined by the order the fax was received. I heard rumours about fax number always being busy, but I got through on the fifth try on a Tuesday morning so it doesn’t seem too bad.
At the current rate, the tax credit should be valid until end of June 2010. The application status is updated every Thursday for the status to Tuesday at the FTB website which you can access by clicking here.
This is what you need to look at. It looks like when the number to the right that says $38,357,000 hits $100,000,000 they are going to shut-off the program.
Applications for First-Time Buyer Credit received as of 05/25/10
|As of||Estimated Total First-Time Buyer Applications Received||57% of Estimated Requested Credit|