Thursday, November 5, 2009

Redeux News: Homebuyer and Jobless Aid Extended

The bill H.R. 3548 brought before the House was approved today on a 403-12 vote. The Senate passed the bill 98-0 yesterday after weeks of delays.

The legislation would provide 14 additional weeks of unemployment benefits in all states, plus another six weeks in those with jobless rates topping 8.5 percent, according to the Department of Labor. It would also allow the home buyers credit for couples earning up to $225,000 a year and individuals earning up to $125,000. That’s up from the current $75,000 limit for individuals and $150,000 for couples. Under the expanded program, the credit would apply to home purchases under contract by April 30, 2010, as long as they close by June 30.

The extension would allow home buyers who have owned their residence for at least five years to receive a $6,500 credit. Those who sell their new home or no longer use it as their main residence within three years would have to repay the credit. Homes worth more than $800,000 wouldn’t be eligible.

According to Smari Money'sLisa Scherze, the new tax credit - coupled with low mortgage rates and the supply of affordably priced homes on the market - may give many people who had been ambivalent of buying that extra nudge to step into the market.

Congress estimates that the bill would not add to the federal budget deficit, in part because it would be financed by delaying until 2018 a tax break for multinational corporations related to taxes they pay abroad. The legislation would also extend a 0.2 percent employer payroll surtax that otherwise would have expired at the end of the year. However, the provision has received complaints from the U.S. Chamber of Commerce, the National Federation of Independent Business and other business groups.

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