Lawmakers Leaves Tax Credit Hanging
Wednesday, March 10th, 2010Washington lawmakers left Capitol Hill without passing an extension of the 2009 First Homebuyers Tax Credit. Lobbyists are busily trying to expand the scope of the 2009 bill, which ends on November 30th 2009. As of August 2009, any property closing after November 30th is not entitled to the $8000 tax credit.
In the past 12 months, two bills have come under consideration at the House of Representatives. The National Association of Realtors, the largest trade organization in the United States with 1.2 million members, is strongly advocating and extension of an expanded bill. NAR members are lobbying members of the House Ways and Means Committee and the Senate Finance Committee.
The NAR is joined by the powerful National Association of Home Builders in efforts to extend the 2009 bill. The Home Builders are addressing a new tax bill including extensive credit modifications with congressional leaders in their home states. The hope is that increased media coverage will pressure firm action.
Chairman of the Senate Banking Committee, Chris Dodd, has teamed up with Georgia Republican Senator Johnny Isakson to sponsor a joint bill extending the current format for another year and broadening the tax credit to $15,000. Other possible adjustments could include expanding the credit to any homebuyer rather than just to first-time homebuyers.
Homebuyers considering delaying a purchase may want to re-think that idea. If the muddle, similar to health care reform, on Capitol Hill continues, the only sure thing to expect is the unexpected. Most first-time homebuyers are applying the old theory that a bird in hand is worth two in the bush. The 2009 $8000 tax credit represents a significant boost form its predecessor, the 2008 credit, which required repayment. This is not the case with the 2009 tax credit, which is expected to assist 350,000 first time homebuyers purchase their first home.