• Allows for a five-year carry back for general business credits (including LIHTCs)
• Provides for a more generous 100% 5-year NOL carryback
• Expands Section 179 small business expensing and bonus depreciation
• Delays for one year the 3% government contractor withholding

• Defers tax liability for up to 10 years (2 years no payment, 8 years pro rata payment) due to cancelled debt from business debt restructuring,and

• Extends the New Markets Tax Credit program

During this week's debate, two additional provisions were added to the legislation:

• Isakson (R-GA)/Lieberman (D-CT) - creates a one-year, non-recaptured, $15,000 tax credit for all purchasers of any principle residence. NAHB worked to ensure this provision would apply to condos, as well as single family homes.
• Bond (R-MO) - dedicates $2B of the proposed $2.25B special allocation of HOME funds for gap financing for LIHTC projects.

Three additional LIHTC-related amendments have been filed and could be considered on the Senate floor today:

• Cantwell (D-WA) - accelerates the amount of LIHTCs an investor can claim in the early years of the credit claim period
• Schumer (D-NY) - fixes the 4 percent credit at 4 percent
• Landrieu (D-LA) - extends the GO Zone LIHTC rules

The Last week, the House passed their version of the “American Recovery and Investment Act of 2009.” The House bill:

• Removes the repayment requirement on the $7,500 homebuyer tax credit,
• Allows businesses to carry back 90% of net operating losses (NOL) over five years (expanded from two years); not available to TARP recipients
• Allows state agencies to “exchange” up to 40% of their 2009 LIHTC allocation (and some unused 2008 credits) for cash grants to be awarded to LIHTC deals
• Expansion of Section 179 small business expensing and bonus depreciation
• Repeal of the future 3% government contractor withholding requirement

Following Senate action this week, the House and Senate must reconcile the differences in their bills through either a conference committee or by passing revised bills back and forth. The stated deadline for completion of the economic stimulus legislation remains the President’s Day Congressional recess which begins at the end of next week.  

For more information, contact Carmel McGuire at 800-368-5242 x8207. [return to top]