$8,000 First Time Buyer Credit To Be Extended

(Washington, D.C) – Senator Max Baucus (D-Montana) announced legislation that would extend the $8,000 first time homebuyer tax credit.  Additionally, the legislation creates a $6,500 tax credit for “move up” buyers that have owned their home for at least 5 years.  Both credits will expire at the end of April 2010.

The Legislation, titled “The Worker, Homeowner and Business Assistance Act of 2009” was introduced as a substitute amendment to the Unemployment Compensation Act of 2009.   The Senate will likely vote on the measure Monday afternoon.

“This extension is extraordinary,” said Dustin Stewart, Executive Director of the Montana Building Industry Association.  “Senator Baucus has created an amazing homeownership opportunity for thousands of Montanans.”

Not only will the continuation of the tax credit help housing affordability in Montana, but it will go a long way toward stabilizing Montana’s housing market, which has declined for over 30 straight months.

“Most Montana homebuilders have seen their businesses decline drastically over the past 2 years,” added Stewart. “The first time homebuyer credit has been our saving grace.  Max’s legislation will go help many companies survive the winter.  Hopefully the market will be healthy enough to stand on its own once spring hits.”

Homebuyer Tax Credit

·    Extends the $8,000 tax credit until April 30^th for first-time homebuyers;

·    Creates a new $6,500 tax credit for move-up buyers for the same period (Move-up buyers must have been residing in their primary residence for 5 consecutive years out of the last 8 in order to qualify for the credit);

·    Both categories of homebuyers have an additional 60 days (June 30^th) to close on the home (certified contract by April 30^th (rather than complete closing) will allow the buyer to qualify);

·    Both categories of homebuyers have new, higher income limits of $125,000 for individuals and $225,000 for couples; and

·    Homes over the purchase price of $800,000 do not qualify.   

NOL Carryback

·    Five year carryback for NOLs in either 2008 OR 2009, not both;

·    Years 1-4 allow for 100 percent use of NOLs, year 5 is limited to 50 percent of a company's      taxable income in that year;

·    No size limitation or other cap on revenues; and

·    Unused NOLs in year 5 are still eligible for 20 year carry forward.

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Contact: Dustin Stewart – 442-4479