Dear Mr. DeHanas,

Thank you for contacting me about a homebuyers' tax credit in "The American Recovery and Reinvestment Act of 2009" (AARA, H.R. 1, Public Law 111-5). I have introduced legislation to create and expand such tax credits.

 

Whole communities are being affected by the housing crisis that is roiling our national, state and local economies, causing cutbacks in services, and hurting millions of hard-working Americans and their families at a time when they most need help. It is important to encourage prospective home buyers to jump into the housing market now.  First-time homebuyers account for more than 30 percent of the market.  In some communities, they account for 60 percent of the market or more.

 

I offered an amendment to AARA that would extend help for the ailing U.S. housing market through the end of this year by changing the date qualified first-time homebuyers could purchase a primary residence through December 31. Extending this tax credit through the end of this year will give many Americans the time to act smartly and swiftly to determine their first step into the housing market.

 

The American Recovery and Reinvestment Act as agreed to in conference and signed into law by the President on February 17, 2009, would provide first-time homebuyers in 2009 a credit against their federal income tax equal to a maximum of 10 percent of a home's purchase price, or $8,000.  The tax credit is refundable, which allows lower-income households with little or no tax liability to take full advantage of the credit. 

 

In addition to my amendment to AARA, I introduced S. 312, First-Time Homebuyers' Tax Credit Act of 2009 with Senator John Ensign (R-NV).  This legislation would provide a $20,000 refundable tax credit to first time-homebuyers for their principal residence. The credit is per purchase, not per person. Individuals with incomes at or below $75,000 and couples with incomes at or below $150,000 would qualify for the credit. This provision would expire one year from date of enactment.

 

Again, I appreciate your letting me know of your support for the homebuyers' tax credit.  Please be assured that I will continue to support efforts that minimize hardship in the event of foreclosures and help ensure homeownership.  If I may be of further assistance with this or any other matter of importance to you, please do not hesitate to contact me.