The House Ways and Means Committee is currently deliberating several amendments to the First-Time Homebuyer Tax Credit, which rewards up to $7,500 for homebuyers who purchased or plan to purchase their first home between April 8, 2008, and July 1, 2009. As it now stands, the credit serves as an interest-free loan, paid back to the IRS over 15 years. However, H.R. 525, sponsored by Congressman John Lewis (D-Georgia), proposes “To amend the Internal Revenue Code of 1986 to repeal the recapture rule of the first-time homebuyer credit and to extend the application of the credit through 2009.” In plain English: Congress is considering eliminating the “payback” quotient of the credit, and extending the qualifying period to enable more homebuyers to take advantage of this incentive.
NAR has thrown its support behind the bill (view the letter from NAR to Chairman of the Ways and Means Committee here), asking that the tax credit period be extended through December 31, 2009. Illinois congressmen Danny Davis (IL-7th) and Peter Roskam (IL-6th) sit on the Ways and Means Committee that will be deliberating this proposed amendment.
To keep abreast of all First-Time Homebuyer Tax Credit news and information, click here. Don’t forget to share IRS form 5405 with your first-time buyer clients so that they can get the credit they deserve!