Baucus Applauds Finance Provisions In Housing Bill
Finance panel crafted measures to shore up shaky loans, help first-time homebuyers, provide tax relief to businesses losing money in economic dowturn
Washington, DC – Senate Finance Committee Chairman Max Baucus (D-Mont.) today
applauded the inclusion in a new housing bill of mortgage and tax relief provisions
crafted by the Finance panel earlier this month. The Foreclosure Prevention Act of
2008, introduced last night by Majority Leader Harry Reid (D-Nev.), contains an
extension of the “net operating loss carryback” law, which will allow struggling
businesses – including America’s homebuilders – to write off current losses over a longer period of years and recoup more cash to stay afloat now. The Finance Committee
included that provision, as well as a measure providing $10 billion in mortgage revenue
bonds, in the comprehensive economic stimulus bill the panel approved on January 30.
The mortgage bonds will help housing finance agencies to refinance subprime loans and
to provide more housing options for homebuyers and renters.
“The Finance Committee crafted several important provisions to help America’s
sagging housing sector, and it’s right for the Senate’s new housing bill to build on
that good work,” Baucus said. “The economic slowdown is draining the housing
sector dry, and the Finance Committee’s tax provision can pump a little liquidity
back into those businesses’ bottom lines. Likewise, the mortgage revenue bonds in
the Finance stimulus bill can boost home financing safely and effectively. Congress
needs to enact these and other smart provisions to shore up the housing sector now.”
For companies losing money in this economic downturn, the Finance Committee
approved a provision allowing corporations to apply excess net operating losses to tax
returns from prior profitable years and receive any applicable refunds. For 2006, 2007,
and 2008 losses, the “net operating loss carryback” will be extended to five years from
the two years currently in law.
The committee also approved a provision providing additional $10 billion of tax-exempt
private activity bond authority to be used to refinance subprime loans, provide mortgages
for first-time homebuyers, and for multifamily rental housing. The measure also exempts
interest earned on the bonds from the alternative minimum tax.
The Senate is expected to consider the Foreclosure Prevention Act of 2008, including
these provisions, following the February home state work period.
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