Plain English Breakdown
The official source states programs are 'as specified' but does not list them within the provided text.
Tax Credit for First-Time Homebuyer Repairs
AB-1714 creates a state income tax credit equal to 40% of the cost, up to $25,000 per year, for repairs required before closing on a home purchased through a specified first-time homebuyer assistance program.
What This Bill Does
- Allows taxpayers to claim a credit equal to 40% of repair costs paid or incurred between January 1, 2028, and December 31, 2032.
- Sets a maximum limit of $25,000 on the total amount paid for repairs in one taxable year that can be used to calculate the credit.
- Requires that the repairs be necessary as a condition of closing the sale of real property under a specified first-time homebuyer assistance program.
- Prohibits more than one taxpayer from claiming this credit for the same property during the same tax year.
- Includes reporting requirements and performance indicators required by existing law for new tax expenditures.
Who It Names or Affects
- First-time homebuyers who use a specified assistance program to purchase real property.
- Taxpayers subject to California's Personal Income Tax Law during the years 2028 through 2032.
Terms To Know
- Tax Credit
- An amount that reduces the total taxes a person owes dollar-for-dollar.
- Closing of Sale
- The final step in buying property where ownership is officially transferred and documents are signed.
Limits and Unknowns
- The bill does not list the specific first-time homebuyer assistance programs that qualify for this credit.
- The text does not define which types of repairs count as 'required' beyond being a condition of closing.
- While the bill takes effect immediately, the tax credit is only available for taxable years starting on or after January 1, 2028.