There are multiple proposals about how to extend the HomeBuyer Tax Credit in the Senate. (Photo: iStockphoto)
Give politicians enough time and they’ll keep coming up with a new angle. That’s apparently what’s happening with the First-time Homebuyer Tax Credit that will expire Nov. 30.
With three proposals already running around the Senate, a fourth idea is gaining traction according to a report by Bloomberg News and may now be the front-runner.
Many of those who felt left out of the previous Homebuyer Tax Credit that was part of the American Recovery and Reinvestment Acts of 2008 and 2009 will be happier with this latest proposal, although the maximum credit is about 9 percent less than the previous programs.
The latest proposal, according to Bloomberg, will allow homeowners who have lived in their current home for the past five years to take advantage of the new credit. The credit will remain at 10 percent of the purchase price but be capped at $7,290 instead of the current $8,000.
First-time buyer income limits would remain at $75,000 for individuals and $125,000 for couples. For those who have owned their home for at least five years, the income levels would be $125,000 for individuals and $250,000 for couples. Also, the credit will not be available on any home purchase above $800,000.
The National Association of Realtors has stated it wants a credit that is good through 2010 to take advantage of the popular spring and summer buying seasons. The organization will be disappointed with this option.
This latest version of the credit will only be available to homes that are under a purchase contract by April 30, 2010. The purchase must also close by June 29, 2010.
Other proposals being shopped in the Senate include leaving the program as-is and just extending it through 2010, expanding the credit to $15,000 maximum and opening it to all buyers, or leaving the credit intact but reducing the amount by $2,000 every three months beginning April 1 to gradually phase out the program.—Rick Hazeltine