Washington, D.C. – April 10, 2008 – The Senate today overwhelmingly passed housing legislation aimed at helping to stabilize the nation’s housing market. The legislation includes Montana’s senior U.S. Senator Max Baucus’ measure that would cut taxes for all property owners in Montana and across the country.
Baucus is chairman of the powerful Senate Finance Committee, which has jurisdiction over all taxes and revenue for the U.S. Government.
The Senate housing bill, which passed by a vote of 84 to 12, is aimed at helping homeowners, homebuyers and homebuilders. The housing legislation contains a measure added by Baucus that would cut taxes for all property owners. The measure includes an additional standard deduction of $500 for people who file individually and $1000 for couples that file jointly.
“This is about doing what’s right for Montana property owners, boosting our state’s economy and creating good-paying jobs,” Baucus said. “This bill will give property owners the tax relief they need and deserve – it will provide a shot in the arm to the housing market.”
Baucus’ tax cutting measure would also provide a substantial credit to buyers of foreclosed homes, and allow companies losing money in the economic downturn – such as America’s homebuilders – to write off more of their current losses.
In addition, the mortgage revenue bond proposal will help homeowners and buyers obtain affordable loans. In addition, Baucus successfully added a measure that will give Montana a $20 million boost in Community Development Block Grant funding. These grants will be used to assist local governments in purchasing and rehabilitating homes that have been foreclosed or abandoned, helping communities deal with the economic downturn on a local level. Montana typically receives around $9 million in CDBG funding in each annual budget.
“This extra CDBG funding is simply great news for Montana,” said Baucus. “These dollars will help our communities stay ahead of the housing crisis and keep their local economies humming along, which in turn will keep our state’s economy strong.”
Baucus’ Tax Cut Measure Would Provide:
• Relief for property owners – an additional standard deduction of $500 for single filers, $1000 for couples filing jointly
• More than $90 million in mortgage revenue bonds for Montana to refinance subprime loans, mortgages for first-time homebuyers and multifamily rental housing. Also exempts interest earned on the bonds from the alternative minimum tax
• A $7000 tax credit for those who purchase homes that are in foreclosure.
• An extension of a law allowing corporations to apply excess net operating losses to tax returns from prior profitable years and receive any applicable refunds. For 2008 and 2009 losses, the provision would extend the “net operating loss (NOL) carryback” to four years (back to 2004 and 2005, respectively) from the two years currently in law. Measures to prevent companies from abusing the intent of the provision are also included.
• $20 million in Community Development Block Grant Funding for Montana.
The Senate bill will now have to reconcile its bill against the House housing bill.