| FEATURE |
CURRENT LAW |
HOUSE VERSION |
SENATE VERSION |
| H.R. 1 |
(Isakson-Lieberman Amendment) |
| Amount of Credit |
Lesser of 10 percent of cost of home or $7500 |
Same as current law |
Lesser of 10 percent of cost of home or $15,000, but only for purchases beginning the date the President signs bill. |
| Eligible Property |
Any single family residence (including condos, co-ops, townhouses) that will be used as a principal residence |
Same as current law |
Same as current law |
| Refundable |
Yes. Reduces (or can eliminate) income tax liability for the year of purchase. Any unused amount of tax credit refunded to purchaser. |
Same as current law |
No. The credit can reduce tax liability to zero, but if purchaser’s tax liability is less than the amount of the credit, the unused portion is not refunded to purchaser. |
| Income Limit |
Yes. Full amount of credit available for individuals with adjusted gross income of no more than $75,000 ($150,000 on a joint return). Phases out above those caps ($95,000 and $170,000, respectively). |
Same as current law |
None. |
| First-time Homebuyer Only |
Yes. Purchaser (and purchaser’s spouse) may not have owned a principal residence in 3 years previous to purchase |
Same as current law |
No. All purchasers, not just first-time homebuyers, are eligible for credit. |
| Recapture/Repayment |
Yes. Portion (6.67% of credit) to be repaid each year for 15 years, starting with 2010 tax filing. If home sold before 15 years, then remainder of repayment amount recaptured on sale. |
Yes and No. Repayment will apply to 2008 purchases. |
Yes and No. For 2009 purchases, the credit will not be repayable UNLESS the home is sold within two years of purchase. Repayment will continue to apply to all 2008 purchases and 2009 purchases before date of enactment. |
| For 2009 purchases, the credit will not be repayable UNLESS the home is sold within three years of purchase. |
| Effective Date |
Purchases on or after April 9, 2008. Repayment to begin for 2010 tax year (return filed in 2011.) |
Repayment elimination applies only to 2009 purchases |
$15,000 amount and repayment feature effective as of date of enactment (date of President’s signature). |
| Termination |
1-Jul-09 |
1-Jul-09 |
1-Sep-09 |
| Interaction with Alternative Minimum Tax (AMT) |
Can be used against AMT, so credit will not throw individual into AMT. |
Same as current law |
Same as current law |
| Allocation Election |
No provision |
No provision |
A purchaser can make an election to take the credit over 2 years. If the purchaser makes this election, the amount claimed must be the same in both years. |
| (Utilizing the credit over 2 years rather than only in the year of purchase) |
| Prepared February 5, 2009 |
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| Subject to Change |
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