Extended Tax Credit Law for Homebuyers Set to Revive the Housing Industry

Extended Tax Credit Law for Homebuyers Set to Revive the Housing Industry

The legislation to extend the tax credit incentive for first-time homebuyers has passed Congress, along with new provisions that benefit home builders as well. Eligible home construction business will also be able to find relief under the new legislation, helping to further the recovery of the faltering housing market. Increased awareness of the legislation, and a rallying call of home builders across the nation who cited their economic plight, and the benefit to the economy should the legislation be extended an additional year, helped the law to pass with an overwhelmingly favorable vote of 98-0 in the Senate and 403-12 in the House. The law will continue to offer a tax credit incentive of $8,000 for first-time homebuyers, as well as a $6,500 tax credit for eligible current home owners that are planning to purchase a new home. This is an add-on to the original legislation which was only for first-time homebuyers! Income eligibility requirements have also been raised considerably, which will allow even more first-time and repeat homeowners to claim the full tax credit. The new changes are aimed to further stimulate buyer demand and revive the housing industry. As part of the extended and revised legislation, NOL tax relief will allow eligible businesses (those who claimed operating losses during 2008-2009) to claim a tax refund for up to five years, vs. the previous limit of two years. The NOL tax relief will affect all businesses, large and small, but the optimal benefit will be to small businesses that are in desperate need of a lifeline. New rules will also suspend the limitations of a taxpayer’s ability to claim the NOL tax relief if they paid AMT in previous tax years. These legislative changes will are poised to create over 200,000 new jobs, and generate 180,000 new home sales in the coming year. Additional economic impacts of the legislation include a speculated $9.6 billion in wage income and $6.9 billion in federal, state and local taxes. There is currently no consideration being given to further extend the new tax credit law beyond this new timeframe. Construction Book Express, a national leader in providing builders, designers and construction professionals with the products they need, urges everyone in the industry to make the public aware of the new legislation. Increasing awareness of the law in both the housing industry and to potential homebuyers will help revive the market and the nation’s economy. If you have questions or would like more information, you can visit the link below and view the FAQ's. Federal Housing Tax Credit FAQ's

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