Senate Majority Leader Harry Reid, D-Nev., has introduced an amendment to the tax extenders bill that would extend the transaction closing date for the First-Time Homebuyer Credit from June 30 to Sept. 30.
Reid joined Sen. Johnny Isaakson, R-Ga., and Senate Banking Committee Chairman Christopher Dodd, D-Conn., to introduce an amendment Thursday to the American Jobs and Closing Tax Loopholes Act of 2010 that would extend the deadline for closing home purchases in order to qualify for the tax credit.
The current deadline for purchases made using the popular tax credit is June 30, 2010, but there is growing concern that because of the time it takes for banks to complete transactions such as short sales, many of these home purchases would not be complete before the deadline through no fault of the homebuyer.
The Reid, Isaakson and Dodd amendment would extend the deadline to Sept. 30, 2010, to ensure the completion of the sales.
The First-Time Homebuyer Credit was very popular and successful in Nevada, Reid said in a statement. In addition to making it easier for thousands of Nevadans to purchase their first home, it helped reduce the sitting inventory of homes. By extending the transaction deadline, we can ensure that everyone taking advantage of this credit can complete the purchase of their new home.
Reid is locked in a tough campaign to hold onto his seat in the U.S. Senate. In the party primary elections on Tuesday, voters chose Sharron Angle, a Tea Party-backed conservative activist, as the Republican nominee who will square off against Reid in November.
The Housing and Economic Recovery Act of 2008 established a tax credit for first-time homebuyers that can be worth up to $7,500. The American Recovery and Reinvestment Act of 2009 expanded the credit by increasing the credit amount to $8,000 for purchases made in 2009 before Dec. 1. The Worker, Homeownership and Business Assistance Act of 2009 later extended the deadline, with taxpayers who have a binding contract to purchase a home before May 1, 2010, eligible for the credit if they close on the home before July 1, 2010.
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