Washington Update - 06/28/2006 (Plain Text Version)

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House Estate Tax Relief Bill Awaits Senate Action

The House of Representatives last week approved legislation that would permanently reduce the estate tax. By a solid bipartisan vote of 269-156, the chamber passed H.R. 5638, the “Permanent Estate Tax Relief Act of 2006.” Because of the importance of this issue to the housing industry, NAHB sent a letter to every House member prior to the vote urging them to support the legislation and designated passage of the bill as a “key vote” for lawmakers.

The measure, which would take effect on Jan. 1 2010, would exempt the first $5 million of an individual’s estate from taxes. The exemption would be $10 million for couples and be indexed for inflation. Estates valued between $10 million and $25 million would be taxed at the capital-gains rate, which is now 15% but is scheduled to rise to 20% in 2011. Estates worth more than $25 million would be taxed at twice the capital gains rate, or 30% under current law.

While NAHB strongly supports congressional efforts to permanently repeal the estate tax, this goal has been consistently thwarted in the Senate. H.R. 5638 is a compromise designed to elicit enough Senate support to win passage while also providing significant estate tax relief. At this point it is uncertain whether enough senators will support this compromise approach to ensure passage. To see how your representative voted on H.R. 5638, click here. View the NBN article or the entire bill by clicking here and typing the bill number in the center screen box. For more information, e-mail Greg Brown or contact him at 800-368-5242, x8421.

FHA Reform Bill Introduced in Senate

On June 19, Senator Jim Talent (R-MO) introduced legislation that would update and modernize the Federal Housing Administration's single-family mortgage insurance programs. S. 3535, the "Expanding American Homeownership Act," has the strong support of NAHB and would increase the FHA's flexibility to mold its mortgage insurance programs to help first-time home buyers, minorities and low- and moderate-income families to obtain the necessary financing to purchase a home. NAHB submitted written testimony in support of the measure during a June 20 hearing before the Senate Subcommittee on Housing and Transportation entitled, "FHA: Issues for the Future." The House Financial Services Committee on May 24 approved similar legislation, H.R. 5121, and the measure is now awaiting consideration before the full House. See the NBN article or view the legislation by clicking here and typing the bill number in the box in the center screen. For more information, e-mail Scott Meyer or call him at x8144. [return to top]