WASHINGTON, D.C. - The U.S. House of Representatives today approved essential legislation to stimulate the economy and provide stability to American families. The House Passed H.R. 3548, the Worker, Homeownership and Business Assistance Act of 2009 by an overwhelmingly bipartisan vote of 403 to 12. The legislation will help continue America’s economic recovery by extending unemployment benefits for millions of workers looking for jobs, as well as extending, expanding and improving the homebuyer tax credit, and providing tax relief for military families and businesses. Many of the provisions in today’s legislation originated in the Committee on Ways and Means, and Committee leaders offered the following statements upon passage:
"Passage of this bill will give critical benefits to the millions of unemployed workers struggling in the current downturn, giving them some measure of relief while they search for the next opportunity to build a brighter future for their families," said Ways and Means Committee Chairman Charles B. Rangel (D-NY). “This legislation also extends the homebuyer tax credit and provides tax relief for struggling businesses to build upon recent gains in the housing market and give American companies a foundation for future growth. I am pleased that Congress has united behind this vital assistance to families and businesses and I look forward to President Obama’s signature so this important bill can become law."
“The American people deserve and have earned this help," said Ways and Means Income Security and Family Support Subcommittee Chairman Jim McDermott (D-WA). “We cannot forget that we’re not yet out of the woods, especially for Americans who are struggling to find a job in an economy where 6 people are competing for every available job. Economists continue to project rising unemployment numbers and Congress will need to act again before the end of this year to allow the extended UI benefits to continue into 2010."
"I am pleased that the legislation extends the first-time homebuyer credit with improvements needed to enhance its administration," said Ways and Means Subcommittee on Oversight Chairman John Lewis (D-GA). "This tax credit is an important resource for families who want to purchase a home and a vital part of our economic recovery efforts. Thus far, this credit has helped over 1.4 million households, the majority of whom have incomes below $50,000. This legislation would help even more moderate-income families fulfill the American dream."
The legislation extends unemployment insurance by up to 14 additional weeks for jobless workers in every state, and a total of up to 20 weeks for workers in states with unemployment levels over 8.5 percent. This provision will help more than 1.3 million jobless Americans whose benefits are set to expire by the end of the year and is fully paid for by an extension of the Federal Unemployment Tax Act (FUTA) through June 30, 2011.
The bill also strengthens the domestic housing market by extending the $8,000 first-time homebuyer tax credit through April 30, 2010, allowing purchasers under a binding contract an additional 60 days to close after that date. Additionally, it will provide a $6,500 credit to new purchasers who have lived in their current residence for five years or more out of the previous eight years. The bill would also increase the income limits on the credit to $125,000 for individuals and $225,000 for joint filers (the current law credit phases out for individuals with income starting at $75,000 and for joint filers with income starting at $150,000). H.R. 3548 also makes critical improvements to administration of the homebuyer credit, based on provisions introduced by Oversight Subcommittee Chairman Lewis, to crack down on potential abuses.
The bill will also eliminate the first-time homebuyers recapture requirement for military personnel, including members of the Foreign Service and intelligence community, who are forced to sell as a result of an official extended duty of service and will allow military personnel serving outside the United States at least 90 days in 2009 or 2010, one additional year to qualify for the credit.
Additional Information on the Worker, Homeownership, and Business Assistance Act of 2009:
Emergency Unemployment Benefits Extension
* The legislation extends unemployment insurance by up to 14 additional weeks for jobless workers in every state, and a total of up to 20 weeks for workers in states with unemployment levels over 8.5 percent.
Help for Homebuyers, Including Military Families
* Extends the $8,000 homebuyer tax credit to first-time homebuyers with a binding contract before April 30, 2010, allowing 60 days to close. (Currently, it will expire Nov. 30, 2009.)
* As soon as the President signs this bill into law, it will expand the homebuyer tax credit to more families -- phasing out for individuals with income above $125,000 and for joint filers with income about $225,000 (the current law credit phases out for individuals with income starting at $75,000 and for joint filers with income starting at $150,000) and make a $6,500 credit available to homebuyers who have been in their current residence for five or more consecutive years out of the last eight years
* The credit is available for the purchase of principal residences with a purchase price of up to $800,000.
* To help service members take full advantage of homebuyer incentives in the Recovery Act, the bill:
o Ensures that certain payments under the Defense Housing Assistance Program (HAP) to assist military personnel selling a home that has declined in value are exempt from tax;
o Ensures service members will not have to repay the first-time home buyer credit if they are ordered to deploy to a different location and, as a result, forced to sell their home within three years; and
o Extends for one year, to April 31, 2011, the deadline for taking advantage the first-time homebuyer credit for qualifying service members, so that certain service members stationed overseas can take advantage of the credit when they return.
* To combat abuse, the bill improves administration of the homebuyers` tax credit by:
o Requiring taxpayers to include documentation to prove that they purchased a home
o Requiring a minimum age of 18 to claim the credit
o Authorizing IRS to look at prior year returns and determine if a taxpayer is eligible for the credit
o Improving tax administration by increasing the number of electronic returns filed by return preparers
Tax Relief for Struggling Businesses/ 5-Year NOL Carryback
* Allows businesses to use net operating losses (NOLs) from 2008 or 2009 to offset profits from five previous years, up from two years. In many cases, that would result in refunds to struggling businesses. Businesses would only be able to offset 50 percent of their income from the fifth year.
* Small businesses who have already elected to carry back 2008 under the American Recovery and Reinvestment Act may also elect to carry back losses from 2009.
Fully Paid for:
* Delay tax break for foreign interest payments (worldwide allocation of interest). The bill delays for seven years (through 2017) a questionable tax break enacted in 2004 that would let U.S. multinational companies that have shipped jobs overseas reduce their U.S. taxes by deducting more of their worldwide interest income against their U.S. income. This provision has not gone into effect, and not one company currently utilizes this provision.
* Increases the penalty for failure to file a partnership or S corporation return.
