Worldwide ERC®’s support of homebuyer tax credit extension legislation and our alignment with other housing industry trade organizations have borne fruit: the legislation earned Senate approval on Wednesday of this week and passed the House of Representatives on Thursday. President Obama is expected to sign the bill today, extending the current $8,000 first-time homebuyer tax credit (which was due to expire at the end of November) through April 30, 2010.
The new legislation includes additional incentives to energize the housing market - a tax credit of up to $6,500 for qualified “move-up buyers,” available immediately after the bill’s signing (provided the buyer owned and used the previous residence as the buyer’s principal residence for five consecutive years out of the preceding eight), and increased borrower income limits for both credits: to $125,000 for individuals and $225,000 for couples. In order to qualify for the full credit, which is limited to homes with a purchase price of $800,000 and below, homebuyers must have entered a binding contract by April 30, 2010 and have closed the transaction by June 30, 2009.
According to the IRS, about 1.4 million people have used the credit since it was introduced this year. Worldwide ERC® Executive Director Karen Reid noted that “the initial 2009 home buyer tax credit infused additional activity into the housing market – a critical element for companies with workforce mobility activity in the U.S. The extension of the homebuyer credit to April 2010, and the decision to expand it to address other types of home purchases is welcome news for our members. We’re pleased to have added our voice to this significant piece of legislation.”
Included in the bill is anti-fraud language providing the IRS with greater oversight authority during the processing of tax returns. The legislation also benefits members of the military, Foreign Service, and intelligence communities on extended duty: if members of U.S. military and uniformed services are stationed out of the country for at least 90 days, they are eligible to use the tax credit through April 30, 2011 after their return to the U.S.
In all, Congress approved an additional $24 billion in support of the housing market and to aid the unemployed, which is very good news for Worldwide ERC® members and the workforce mobility industry.
Latest Major Action: 11/6/2009 Signed by President