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The tax credit for new homebuyers, scheduled to last through next March, will be out of money long before that.

Time may be running out for California residents wanting to take advantage of a $10,000 tax credit. The state set aside $100 million to help home buyers purchasing newly built homes, the goal was to give a much needed boost to the residential-construction market. But only about 20% of the money is left.

About a third of the way through the program the money is almost gone. The program launched in March and by June 3 nearly $24 million in tax credit certificates had already been issued, according to the state's Franchise Tax Board.

There are already numerous applications in place requesting the credit. In fact, if all the submitted applications are approved, only $17.5 million will be left in the fund.

The credit is available on a first-come first-served basis and was supposed to last through March 2010. Almost any newly built home qualifies, as long as it's an owner-occupied, principal residence on which property tax is paid. It could be a single-family home, a condo, a coop, a manufactured home or mobile home. Only owner-built housing does not qualify. There is no cap on the home price or buyer's income.

The credit reduces taxes dollar-for-dollar up to $3,333 a year for three years, or 5% of the purchase price of a home, whatever is less. Unlike the federal program, which is $8,000 or 10% of the home price, whichever is less, the California credit is not refundable. That means the credit will only wipe out taxes up to the full amount paid or owed but no more.

Is more money coming?

Because the money has gone so quickly, the state legislature is considering adding another $200 million to the program. With the state having a 24 billion dollar deficit this may or may not happen.

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