The Obama administration has not yet decided whether it should bring back a popular tax credit for first-time homebuyers, Housing and Urban Development Secretary Shaun Donovan said on Sunday.
"It's too early to say whether the tax credit will be revived," Donovan said in an interview on CNN's "State of the Union" program. He said the administration would "do everything we can" to stabilize the shaky U.S. housing market.
The analysis is based on the previous federal $8,000 homebuyer tax credit that boosted home sales reviving parts of the housing market. This credit expired several months ago, and things started going down.
The unexpectedly large drop in U.S. home sales in July has brought back fears that the nation could be on the cusp of another sharp drop in housing.
Donovan acknowledged that the data was worse than the Obama administration expected but said the government was already taking measures, including rolling out a refinancing program for some borrowers and an emergency loan program for the unemployed.
Some believe that bringing back the tax credit would help improve the current housing situation. However, those that oppose this idea, say it would blow a bigger hole in the federal deficit.
"I think it would help enormously," Florida Governor Charlie Crist, who is running as an independent for the U.S. Senate in the November elections, told CNN. "I would absolutely encourage the president to support that." His opinion was supported by U.S. Representative Kendrick Meek, a Florida Democrat, who said he also supported reviving the tax credit.
Last month, Obama signed a law giving consumers already in the process of buying a home three extra months to close the deal and still get the tax credit.
This means that homebuyers with contracts signed by April 30 who failed to go to closing by the original June 30 deadline will now have until September 30 to complete their purchases.
Labels: Georgia homes, Home, Home Buyers, home buying, homes, homestead tax relief grant program, tax credit
# posted by
Brian Vanderhoff @ 10:41 AM
Homeowners should pay close attention to budget discussions underway at the Capitol about the proposed elimination of the Homestead Tax Relief Grant (HTRG) Program. Governor Sonny Perdue has recommended not to reimburse local governments for this program, which provided a nearly $429 million tax break for homeowners on their 2008 property tax bills. For most homeowners, this credit amounted to a $200 - $300 savings each. A legal opinion issued by the Association County Commissioners of Georgia (ACCG) indicates that counties may not legally absorb the amount of these credits into their local government budget. This means that all homeowners will receive a delinquent property tax notice later this spring if reimbursement for the HTRG program is not included in the final budget passed by the General Assembly.
“We feel for our Governor and state legislators who are trying to fix a $2.2 billion budget shortfall and we know that they are very concerned about this program,” said Jerry Griffin, Executive Director of ACCG. “We just want everyone to understand that if this program is not funded, Georgia homeowners will have to get out their checkbooks to pay back the credit because counties have no legal authority to forgive taxes or lower the millage rate established in 2008 to offset the loss of the HTRG credit.”
“Residents in my county are very concerned about this issue,” said Lamar Paris, Sole Commissioner of Union County and 1st Vice-President of ACCG. “Many of our residents are already struggling to make ends meet, and an unexpected bill like this one will not make it any easier. I don’t know of any other state program proposed for elimination that would result in an immediate tax increase for Georgia homeowners.”
Homeowners have benefitted from HTRG since it was established through legislation in 1999. Local governments set their budgets and tax rate and then, in producing the tax bills, the Tax Commissioner calculates the value of the tax credit based on the combined millage rate (county, city and Board of Education) multiplied by an established value ($8,000 for 2008). The credit is subtracted from property tax bills and the local government files for reimbursement through the Georgia Department of Revenue. A line on the property tax bill clearly states that this credit comes from the State of Georgia, not local governments. The benefits of this program are entirely for the homeowner; local governments do not receive any of the funds.
The credit also is not a part of the county budgeting and millage rate setting process that are determined by following the Taxpayer Bill of Rights established through legislation by the General Assembly. Counties simply play an administrative role for the state in placing this credit on a homeowner’s property tax bill.
The Georgia General Assembly appropriated the funds for the 2008 HTRG credits through the General Appropriations Act in March 2008, which the Governor signed. Governor Perdue suspended the reimbursement in August 2008 based on the state’s projected budget shortfall. His budget recommendations call for not reimbursing the counties for the credit already issued to homeowners for last year’s property taxes and eliminating the program.
“Homeowners will be angry with both state and local officials if they receive a delinquent tax notice for their 2008 property taxes,” said Griffin. “We strongly encourage legislators to include the funding for the credit that homeowners have already received or we will all hear about it.”
About ACCG: It is the mission of the Association County Commissioners of Georgia to enhance the role, stature and responsiveness of county government in Georgia. Since counties are the level of government closest to the people and serve all the people of the state, ACCG will promote the ability of Georgia counties to provide public services responsibly, efficiently, and cost effectively through cooperative legislative action, education of public officials, provision of quality member services and technical assistance, and increasing public awareness of critical local government issues. http://www.accg.org
Labels: Georgia, homestead tax relief grant program
# posted by
Brian Vanderhoff @ 8:22 PM
