Broken Arrow, OK Home Buyers Given $8,000 Tax Credit

A bill, H.R. 5623 that was recently passed in the House and the Senate was being watched very closely by Broken Arrow, OK home buyers who had not yet closed on their new home purchases. The situation had been looking somewhat bleak for Broken Arrow, OK home buyers as well as many others across the country. They had signed contracts to purchase their first home with the assumption that everything would be in order to allow them to receive an $8,000 tax credit.

However, the delays in closing were causing them to second guess whether they had made the right decision. Broken Arrow, OK home buyers were part of the approximately 180,000 that had signed purchase agreements and were going to miss the deadline for closing that would allow them to claim the tax credit. The passage of H.R. 5623 has provided these Broken Arrow, OK home buyers an extra 90 days to close, relieving the pressure for the time being.

The homebuyer tax credit is loosely based on a similar situation from the 1970s. The U.S. was in a housing crisis then as well and Congress passed a tax credit allowing new homebuyers to claim $2,000 if the home was going to be their principle residence. The housing market stabilized and inventory decreased as a result of the tax credit. Many are hoping that history will repeat itself and the housing crisis being faced today will be solved by the passage of the latest tax credit bill.

The original bill, HR 4213 was having problems being passed which was due to provisions that had been attached. The main one was extending the benefits for more than 1.7 million unemployed. The hope was that the tax credit for homebuyers would push the bill through with the inclusion of the extension of unemployment benefits. However, this did not happen and the bill stalled in Congress.

This prompted the introduction of H.R. 5623, which also has some provisions but left out the extension of unemployment benefits. The provisions that are included with this bill are geared more towards preventing the rampant fraud that has been a part of the tax credit. This bill passed by a 409 to 5 margin. In addition, even some states are offering incentives to purchasers. The ultimate outcome would be a reversal of the problems faced by the housing market. However, this remains to be seen.

In addition to the tax credit for first time home buyers there is a credit for those who are buying but have owned a home before. They would receive up to $6500 in a tax credit if they owned and lived in their previous home for at least 5 years of the last 8 and purchased the new home after the 8 year period.