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Homebuyer credit extension a done deal? NOL carrybacks enhanced?

October 29, 2009

Senate Majority Leader Harry Reid says Senate Democrats will push an extension of the ~~insane~~ Popular First Time Homebuyers Credit that will make it available to more buyers with higher incomes.

The plan isn't final yet, but Bloomberg reports that the income limits for the $8,000 credit will double - to $250,000 for joint filers and $150,000 for single taxpayers. It would also allow non "first-time" homebuyers to get a $6,500 credit if they move from a house they've lived in for five years.

Bloomberg also says the bill would contain net operating loss legislation -- presumably an increase in the 2-year carryback period for 2009 losses.

To underline the bipartisan nature of economic illiteracy among congresscritters:

Senate Minority Leader Mitch McConnell, a Kentucky Republican, agreed that most lawmakers support the unemployment and homebuyer measures. “We’re not that far away from an agreement,” he said earlier today.

It's nice to know that a majority of the millionaires in the Senate think it's wise to spend $40,000 to $80,000 of our money for each new home sale caused by the credit, even though the credit is rife with fraud.

The credit extension would be tied to an extension of unemployment benefits; the provisions may still be changed, and it has to be reconciled with a House bill that has no homebuyer credit provision.

If they extend it this time, does anybody believe they won't try to extend it again every time it is set to expire?

Kay Bell and TaxGrrrl have more.