Moments ago, President Obama signed into law the Unemployment Compensation Extension Act (H.R. 3548) that included, as an amendment, the extension and expansion of the Homebuyer Tax Credit.

The new bill calls for an incentive for existing homeowners who have owned their current homes at least five years, making them eligible for tax credits of up to $6,500 when they purchase a new home. First time homebuyers – or anyone who hasn’t owned a home in the last three years – would still get up to $8,000. To qualify, buyers in both groups have to sign a purchase agreement by April 30, 2010 and close by June 30.

The credit is available for the purchase of principal homes costing $800,000 or less, meaning vacation homes are ineligible. The credit would be phased out for individuals with annual incomes above $125,000 and for joint filers with incomes above $225,000.

NAR has put together some good documents to help you understand and explain the tax credit to your clients. They include an FAQ and an overview of the tax credit changes.

This truly is exciting news for our industry and now more than ever we need to take advantage of this opportunity. This is said to be the last tax credit that the government will offer so first time home buyers and move-up buyers should do their best to take complete advantage of it.