|
Real Estate Provisions in Last-Minute Tax Bill
In one of the last acts of the 109th Congress, lawmakers in the wee hours of Dec. 9 passed a major tax and trade bill that includes several expired tax provisions that have languished for nearly a year. The measure would also normalize trade relations with Vietnam and extend through 2008 duty-free access to the U.S. to more than 100 developing nations.
The major tax portion of the bill includes extensions of the research and development tax credit through 2007, and a two-year renewal of the deduction for state and local taxes and higher education tuition expenses.
The bill also contains several real estate-related provisions. Items of importance to home builders include:
- Extension of the placed-in-service date requirement for the GO Zone bonus depreciation on nonresidential real and residential rental property.
- Extension of the New Markets Tax Credit program and expansion to better serve the needs of rural communities.
- One-year extensions of the credit for new energy-efficient homes, the credit for residential energy-efficient property and the deduction for energy-efficient commercial buildings.
- Extension of expensing of brownfield remediation costs and expansion of the definition of a brownfield to include sites contaminated by petroleum products.
- Permanence for a change to the veterans' mortgage revenue bond program that eliminates the sunset of the program in selected states.
- Waiver of the first-time-home buyer requirement for veterans in the mortgage revenue bond program.
- Establishment of a one-year deduction for private mortgage insurance.
Also of note, the legislation includes a measure sponsored by Sens. Harry Reid (D-Nev.) and John Ensign (R-Nev.) that would promote land conservation in White Pine County, Nev. As originally written, the legislation called for mandatory federal inclusionary zoning policies to address unique local development issues.
NAHB lobbied against this provision, noting that inclusionary zoning policies are not an effective way to address a community’s housing affordability problem and that any solution to address this issue must come locally, not from a federal mandate. In a significant victory for NAHB, the mandatory exclusionary zoning requirements were stripped from the final bill.
For more information, e-mail Greg Brown at NAHB or call him at 1-800-368-5242 x8421.
|
