Late last week the House Way and Means Committee unveiled the a bipartisan bill that is currently being taken into consideration by the House of Representitives.

The Service Members Home Ownership Act of 2009 would correct a problem that was previously occuring for military members with the First-Time Homebuyers Tax Credit.  Many military members were not taking part in purchasing their first home and taking advantage of the $8,000 first time homebuyers credit because of the concern that they would have to pay back the money they receive from the tax credit if they get transferred to a different station before they have owned and resided in the home for 36 months.

The first time homebuyers tax credit has a clause in it that prevents first time homeowners from selling their house or renting out their house before the initial 36 months has passed.  If you choose to move out prior to the 36-months or are not using the home as your primary residence you must pay back any tax credit that you received from the program.  The Service Members Home Ownership Act of 2009 would change the requirements for military personnel.

The main benefits that service members will see if the bill is passed are:

•  Certain service members would be exempt from paying taxes if they are forced to sell their home at a depressed price. Among those eligible for the tax exemption would be wounded service members and service members who had to sell their home because they were permanately assigned to a new duty station.
• Service members and certain federal workers who buy a home before December 1, 2009 will not have to repay the $8,000 tax credit if they sell their home or stop using it as their primary residence within the first three years if they are forced to sell or rent out their house because of government orders.
• Service members, foreign service officers and members of the intelligence community who were deployed outside of the U.S. for 90 days or more between January 1 and December 1, 2009 will have be able to close on a house after December 1, 2009 and still be able to take advantage of the first time homebuyers tax credit.

This bill  is passing throught the Senate quickly and will possibly be signed and put into place within the next two weeks.

If you are a military member purchasing a home in New York or New Jersey and need a real estate lawyer in Staten Island, New York contact Steven T. Decker at 718.979.4300.