Federal Housing Stimulus Bill

The US Congress adopted the Federal Stimulus package, and President Obama has now signed it.  Within the stimulus package, an amendment authored by Senator Johnny Isakson addresses the housing industry.  Senator Isakson introduced the amendment after previsouly introducing stand-alone legislation earlier in the year.  The amendment, as passed by the Senate, would provide a direct income tax credit to any homebuyer who purchases any home.  The amount of the tax credit would be $8,000 or 10% of the purchase price, whichever is less.  Purchases must be made within one year of the legislation’s enactment.  This legislation differs from similar legislation passed in 2008, in that the credit does not have to be repaid.  The legislation allows the credit to be taken on 2008 tax returns and only applies to purchases of principal residences.  The credit must be repaid if the home is sold within two years.