Washington, DC – June 29, 2010 – (RealEstateRama) — Today, Rep. Michael E. McMahon continued a fight he has been championing since early 2009 – extending the $8,000 first-time homebuyers’ tax credit. HR 5623, The Homebuyers Assistance and Improvement Act of 2010, which Rep. McMahon supported, extends the closing date by which homebuyers will be eligible for the tax credit. The bill passed the House by a vote of 409 to 5.
“Extending this tax credit makes sense,” said Rep. McMahon. “Not only do we want to continue to strengthen our housing market – which empirical data has shown that this tax benefit does – we want to also provide opportunities for hard-working families to finally purchase their own home. Many of my constituents in Staten Island and Brooklyn are pinching pennies, but not giving up on their dreams. The first-time homebuyers tax credit will allow them to make their dreams a reality.”
Currently, in order to qualify for the first-time homebuyers’ tax credit, purchasers must close on a principal resident before July 1, 2010. HR 5623 extends the closing date to September 30, 2010, so long as the homebuyer has entered into a contract for the purchase of a home by April 30, 2010.
HR 5623 is fully paid-for by (1) applying a current-law penalty for bad checks to electronic payments, (2) permitting disclosure of prisoners’ tax return information to crack on instances of fraud regarding first-time homebuyer tax credit, and (3) changing rules relating to fees for a travel promotion fund.
It is estimated that almost 10,000 purchasers in New York alone will lose the tax credit if Congress fails to pass the extension. HR 5623 now needs to be taken up by the Senate in order for the tax credit to be extended.
Rep. McMahon has been at the forefront of improving the housing market by pushing to extend the first-time homebuyers tax credit provided in the American Recovery and Reinvestment Act (ARRA). During ARRA negotiations, the Senate Finance Committee modified the first-time homebuyer tax credit by extending the credit’s expiration date, set for June 30, 2009, until August 31, 2009. In February 2009, Rep. McMahon urged House Ways and Means Committee Chairman Charles Rangel to extend the credit even further – specifically to the end of 2009 since summer and early fall are traditionally active season for home purchases. As the then-deadline of November 30, 2009 approached, Rep. McMahon again urged his colleagues to extend the credit. In November 2009, before the extension expired, he voted to extend the tax credit through April 30, 2010, as well as provide a $6,500 credit to new purchasers who have lived in their current residence for five years or more.
