$8,000 Tax Credit Extended for Service Members

This week, the Service Members Home Ownership Tax Act of 2009 was passed in the House by a vote of 416-0. More than 1.4 Americans have taken advantage of the $8,000 tax credit, which expires at the end of November of this year. Because of the three-year residence requirement, many service members were reluctant to buy homes using the credit; service members can be relocated at a moment's notice, and so they did not want to take the chance that the credit would have to be paid back. This new Bill eliminates the requirement for a minimum of three years in the home, and so makes the credit more accessible to service members.

The extension of the credit until November 30, 2010 applies to service members including Foreign Service and intelligence personnel who have served at least 90 days during 2009. Many service members who were returning at the end of this year, and who were planning on buying homes, were concerned about not being able to take advantage of the incentive. When this oversight was presented to Congress, they immediately took action to extend the credit for one year to the 350,000 soldiers who are currently deployed overseas.

The leglislation was introduced by Charles Rangel of New York. "This bill makes certain that the brave men and women who put their lives on the line every day get to enjoy the same benefits as every other American who benefits from their service," said Rangel in a statement. "By extending the first-time homebuyer tax credit for service members overseas, we give these families more time to utilize the benefit, while also helping our economy continue its recovery."

Members of Congress have been in discussions with the Obama administration regarding extending the original first-time buyer tax credit beyond the deadline, and expanding it to include more types of buyers. There are several bills on the table, but word is that a decision will not be made until the last week of November.

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