Will $8,000 Tax Credit Be Extended?
Talk about the $8,000 tax credit set to expire at the end of November is increasing... The majority of our sales are being driven by cash investors in the lower price ranges and first-time home buyers scrambling to procur a sale before the end of November. Will the government extend this tax credit? How can we afford not to in this fragile economy we are still in.
The article below has some great information on the tax credit extention question many of our clients have been asking us about:
Washington Report: $8,000 Home Buyer Tax Credit by Kenneth R. Harney
Quick passage by the House last week of a bill extending the $8,000 home buyer tax credit next year for military, diplomatic and intelligence personnel serving overseas increases the odds that Congress will agree to an extension, maybe even an expansion, of the entire credit program well into 2010.
The White House is also signaling that it sees the overall tax credit program -- currently set to expire November 30 -- as an important element in cutting the unemployment rolls and stimulating new jobs next year.
After an economic policy strategy meeting last week in the Oval Office involving President Obama, House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid, congressional aides said Democrats generally support an extension of the housing credit.
Reid already has made clear he wants an extension. He is co-sponsoring a Senate bill that would do so for six months.
Congressman Charles Rangel, chairman of the tax-writing House Ways and Means Committee, sponsored the one-year extension of the credit for military and other personnel serving overseas, and is reported by aides as favoring an extension for the entire program.
The White House has not publicly committed to an extension, but has confirmed that the President is seriously examining that option.
An unexpected development that emerged following last week's White House meeting was the possibility of opening up the credit to a broader group of buyers next year - people who sell their current homes and buy a replacement home.
Though details were scanty, Capitol Hill sources said one option on the table would be to provide a tax credit -- most likely at the $8,000 level -- to replacement home buyers whose incomes do not exceed some limit.
The current credit phases out for single taxpayers with incomes above $75,000, and married purchasers earning $150,000.
A politically sensitive issue hovering over the entire debate on extending the housing tax credit is its cost - what it would add to the federal budgetary deficit. Mark Zandi, chief economist of Moody's Economy.com, estimates that widening the credit to all buyers through next August could cost the government upwards of $30 billion.
Rangel's 12-month extension of the credit for service personnel is estimated to cost more than $300 million, but it's mainly being paid for through an increase in penalties levied by the IRS on taxpayers who fail to file corporate or partnership returns.
The New York Times reported that one possible solution to the cost problem would be to divert money not yet spent out of 2009's $800 billion stimulus legislation.
If you have questions about the market feel free to contact me via email or phone. Please forward this information on to anyone that may find value in this information.
Your Yorba Linda Real Estate Expert, Sabrina Solesbee
The Solesbee Group 800-528-0995
The article below has some great information on the tax credit extention question many of our clients have been asking us about:
Washington Report: $8,000 Home Buyer Tax Credit by Kenneth R. Harney
Quick passage by the House last week of a bill extending the $8,000 home buyer tax credit next year for military, diplomatic and intelligence personnel serving overseas increases the odds that Congress will agree to an extension, maybe even an expansion, of the entire credit program well into 2010.
The White House is also signaling that it sees the overall tax credit program -- currently set to expire November 30 -- as an important element in cutting the unemployment rolls and stimulating new jobs next year.
After an economic policy strategy meeting last week in the Oval Office involving President Obama, House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid, congressional aides said Democrats generally support an extension of the housing credit.
Reid already has made clear he wants an extension. He is co-sponsoring a Senate bill that would do so for six months.
Congressman Charles Rangel, chairman of the tax-writing House Ways and Means Committee, sponsored the one-year extension of the credit for military and other personnel serving overseas, and is reported by aides as favoring an extension for the entire program.
The White House has not publicly committed to an extension, but has confirmed that the President is seriously examining that option.
An unexpected development that emerged following last week's White House meeting was the possibility of opening up the credit to a broader group of buyers next year - people who sell their current homes and buy a replacement home.
Though details were scanty, Capitol Hill sources said one option on the table would be to provide a tax credit -- most likely at the $8,000 level -- to replacement home buyers whose incomes do not exceed some limit.
The current credit phases out for single taxpayers with incomes above $75,000, and married purchasers earning $150,000.
A politically sensitive issue hovering over the entire debate on extending the housing tax credit is its cost - what it would add to the federal budgetary deficit. Mark Zandi, chief economist of Moody's Economy.com, estimates that widening the credit to all buyers through next August could cost the government upwards of $30 billion.
Rangel's 12-month extension of the credit for service personnel is estimated to cost more than $300 million, but it's mainly being paid for through an increase in penalties levied by the IRS on taxpayers who fail to file corporate or partnership returns.
The New York Times reported that one possible solution to the cost problem would be to divert money not yet spent out of 2009's $800 billion stimulus legislation.
If you have questions about the market feel free to contact me via email or phone. Please forward this information on to anyone that may find value in this information.
Your Yorba Linda Real Estate Expert, Sabrina Solesbee
The Solesbee Group 800-528-0995
posted by Sabrina Solesbee at
9:05 AM
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