Tax Credit and Flood Insurance retroactive
WASHINGTON – July 1, 2010 – The deadline for closing on a home and qualifying for the federal homebuyer tax credit ended at midnight, and the National Flood Insurance Programs expired May 31, 2010. But two bills reauthorizing each program received Congressional approval yesterday, though both still need President Obama’s signature to become law, a move expected shortly.
Once the president signs the bills, both extensions become retroactive, meaning the law will not recognize a lapse in coverage for either program.
Homebuyer tax credit
The only thing that changes under the new tax credit bill – The Homebuyer Assistance and Improvement Act (H.R. 5623) – is the deadline for closing on a home. Under the latest version of the tax credit, buyers had to secure a signed contract by April 30, 2010, and close by June 30, 2010. The bill extends the closing deadline to Sept. 30, 2010.
Short sales, however, can take considerably longer than two months to close. And an onslaught of buyers trying to beat the June 30 deadline proved challenging to Realtors, title companies and lawyers trying to beat the clock.
The National Association of Realtors lobbied heavily to get the tax credit extended, but Congress took the issue down to the wire before eventually approving the change.
National Flood Insurance Program
The federal flood insurance program has general support among lawmakers, but they continue to disagree on the details. As a result, it has expired three times this year, only to be reauthorized after the fact by Congress. Each extension is considered a short-term fix so lawmakers have time to consider a long-term solution.
Officially, NFIP is still on hiatus until the president signs the bill, HR 5569, into law; but once that happens, it’s official again back to May 31, 2010.
© 2010 Florida Realtors®