Q: I have lived in my home more than 32 years. I signed a contract to build a new home on my lot for $400,000. It will be ready next September. I’ll move out into a rental during construction.

Do I qualify for the new $6,500 home buyer tax credit? Please let me know. I expect to close on the construction loan by December 5, 2009.

A: If you’re tearing down your existing home and building a new home on your own lot, you will not qualify for the first-time home buyer tax credit.

If you’ve purchased a lot and are building a home on that lot that won’t be completed until September, 2010, you are still out of luck. You must close and move into your newly-constructed home by June 30, 2010 to qualify for the trade-up tax credit.

Purchasing a lot and closing on a construction loan aren’t enough to qualify you for the tax credit. Your home won’t be habitable until after the tax credit has expired. You’d not only have to move into the home by that time but you might also have to have an occupancy permit issued by the appropriate local authorities as evidence that the home was complete on a certain date.

Read more about the expansion and extension of the home buyer tax credits

For more details or go to the IRS website, irs.gov and search for “first-time home buyer tax credit update.”