Extension of the First-Time Home Buyer Tax Credit Looming on the Horizon

Is an extension of the First-Time Home Buyer Tax Credit truly looming on the horizon? To say the least, it is certainly looming in the forefront of many a consumer's mind. Each morning I wake up to my Twitter and Facebook feed, to see a surplus of comments, either from consumers, begging for the extension so they can surpass the current December 1 deadline, or from agents, bickering back and forth about the pros and cons of such a venture. It's a hot top of desire, and of debate.

So what is the current state of the extension of the First-Time Home Buyer Tax Credit? Well, passing of such an act is no more than mere speculation at the moment, despite what many on-line sources are claiming. Today, Fox News reports that Senate negotiators have reached an agreement to extend the credit, but that its passage remains undetermined.

Currently, the following substance of the credit has been determined:

• Credit will be extended from its current December 1 expiration to April 30, 2010, with all homes closing before July 1, 2010.
• Income limits on those consumers claiming the credit will increase from $75,000 for a single homeowner to $125,000, and from $150,000 to $250,000 for couples.
• The tax will not only include first-time home buyers, but will be extended to a $6,500 credit for existing homeowners who have occupied their current residences for five consecutive years of the past eight.

The general goals of this amended tax credit piggyback off of the previous credit. The aim is to stimulate a weakened economy further by granting the distressed real estate market a larger boost while limiting the advantages to investors. This extended credit also seeks to attract the higher-end buyer, where the market continues to remain in dire state.

Some Democrats are currently hoping to add the bill to one already currently on the Senate floor - to extend federal unemployment tax benefits. This agreement, however, has yet to be confirmed, leaving the question lingering . . . and looming . . . as it has.