From the Associated Press
WASHINGTON – Buying a home is about to get cheaper for a whole new crop of homebuyers — $6,500 cheaper.
First-time homebuyers have been getting tax credits of up to $8,000 since January as part of the economic stimulus package enacted earlier this year. But with the program scheduled to expire at the end of November, the Senate voted Wednesday to extend and expand the tax credit to include many buyers who already own homes. The House could vote on the bill as early as Thursday.
Buyers who have owned their current homes at least five years would be eligible for tax credits of up to $6,500. 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.
"This is probably the last extension," said Sen. Johnny Isakson, R-Ga., a former real estate executive who championed the credits.
The homebuyers tax credit is one of two tax breaks totaling more than $21 billion that the Senate included in a bill extending unemployment benefits for those without a job for more than a year. The other would let companies now losing money recoup taxes they paid on profits earned in the previous five years.
"We are still in a world of economic hurt, and Congress must continue to act boldly and creatively," said Sen. Max Baucus, D-Mont., chairman of the Senate Finance Committee. "With the right mix of tax breaks and investments we will get through this recession and get folks working again."
The real estate industry has been pushing to extend and expand the housing tax credit. About 1.4 million first-time homebuyers have qualified for the credit through August. The National Association of Realtors estimates that 350,000 of them would not have purchased their homes without the credit.
Extending and expanding the tax credit for homebuyers is projected to cost the government about $10.8 billion in lost taxes. While the measure passed the Senate by a 98-0 vote, Sen. Kit Bond, R-Mo., questioned its efficiency in stimulating home sales.
"For the vast majority of cases, the homebuyer tax credit amounted to a free gift since it did not affect their decision to purchase a home," Bond said. "And for the small minority of buyers whose decision was directly caused by the credit, this raises the question of whether we are subsidizing buyers who may not have been able to afford buying a home in the first place."
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.
The credit would be extended an additional year, until June 30, 2011, for members of the military serving outside the United States for at least 90 days.
Expanding the tax credit for money-losing companies is projected to cost $10.4 billion.
The business tax break would allow money-losing companies to use current losses to offset taxable profits earned in the previous five years, giving them refunds of taxes paid in those years. Under current law, businesses with annual gross receipts of more than $15 million can claim losses back only two years.
The tax break would help industries suffering losses in 2008 or 2009, including retailers, homebuilders and newspapers. Congress included a scaled-back version of the tax break — for companies with revenues of $15 million or less — in the economic recovery package enacted in February. The new tax break would be available to companies of any size, providing a quick source of cash.
The U.S Chamber of Commerce has been a big backer of the tax break for money-losing companies.
"It frees up capital that they can use to maintain jobs and potentially even hire new people as the economy returns," said Caroline Harris, senior tax counsel for the U.S. Chamber of Commerce.
The tax breaks would be paid for largely by delaying a tax break for multinational companies that pay foreign taxes. It was passed in 2004 and originally was to have taken effect this year, but would now be delayed until 2018.
___
The bill is H.R. 3548.
Build Your Own Solar Power System and Combine with Wind Power
Solar and Wind Power
Trae Gardner
Commercial Properties,
We Buy Houses
Contact Us | Free Home Valuation | Find A Home! | Homes For Sale Allen Tx | New Homes For Sale | Christian Realtor | Homes for Sale Rowlett Tx | Homes For Sale Rockwall Tx | Homes For Sale Carrollton Tx | Lake Front and Lake View Properties | Find and Investment Property | Higland Homes in DFW | Higland Home Virtual Tours | Client Testimionials | Dream Home | Homes For Sale Highland Park Tx | North Dallas Homes For Sale | Mckinney Texas Realtor | In Home Commercial | Homes For Sale Plano Tx | Homes For Sale Melissa Tx | Real Estate Resource Links | School Rankings in Texas | Real Estate Blog | Luxury Homes | Homes For Sale Richardson Tx | Find Homes For Sale | Stonebriar Country Club | Chapel Creek Frisco Texas | Starwood Homes For Sale | Lakes On Legacy Frisco | Homes For Rent McKinney Tx | Twitter DFW | McKinney Schools | Distressed Properties | 100% Financing | Solar Power | Solar_Wind | Homes For Sale Frisco Tx | Homes For Sale Addison Tx | Homes For Sale McKinney Tx | Homes For Sale Sachse Tx | Homes for Sale Prosper Tx | Application Instructions | Homes For Rent Frisco Tx | Homes For Rent Plano Tx | Homes For Rent Carrollton Tx | Homes For Rent Addison Tx | Homes For Rent Allen Tx | Homes for Rent Little Elm Texas | Homes For Rent Grapevine Tx | Highland Park Homes For Rent | Homes For Sale Celina Tx | Homes For Sale University Park Tx | Homes For Sale Flowermound Tx | Homes For Sale Fairview Tx | Homes For Sale Southlake Tx | Get Pre-qualified | News | Real Estate Glossary | Our Featured Homes | Home Page | Applying for a Loan | Mortgage Saving Tips | Your Buying Power | Frisco MLS | McKinney MLS | North Texas MLS Search | 9 Steps to Owning | Seller Paid Closing | Site Map | Request Industry Info | Real Estate Blog
Copyright © 2010 Stonebridge Realty GroupPortions Copyright © 2010 a la mode, inc.Another XSite by a la mode, inc. | Admin Login| Terms of Use| Site MapAll rate, payment, and area information are estimates and approximations only.