Senate leaders also propose extending the first-time homebuyer tax credit

In the grand poker game that tax legislation has become, the Senate last night saw the House's proposal to extend the first-time homebuyer credit and raised the bet.

Where the House late Tuesday afternoon overwhelmingly passed a bill to extend the credit's closing date to Sept. 30, the Senate matched that new deadline and raised the legislative stakes by combining it with, among other things, continuation of unemployment benefits.

The House considered the homebuyer credit and unemployment extensions separately yesterday, passing the real estate tax break but defeating the continued assistance for the long-term jobless.

Without the extra time, around 180,000 homebuyers might miss out on the $8,000 tax credit.

Without the extra time, around 535 lawmakers might miss out on crucial midterm election-year campaign contributions from the real estate industry.

And without the unemployment benefits, about 1.7 million folks won't have enough money to pay for day-to-day living expenses.

Who benefits, who pays? In the statement issued by Reid and Baucus about their proposal, they say:

"[T]he homebuyer tax credit was expanded and extended to allow homebuyers to receive a tax credit for the purchase of a qualifying home through April 30, 2010. Homebuyers can benefit from the tax credit up to July 1, 2010 if they entered into a binding contract by April 30, 2010 and close on the home within 60 days. This provision extends the closing date for homebuyers who entered into a binding contract by April 30, 2010, allowing them to be eligible for the tax credit if they close on the home before October 1, 2010. The provision is estimated to cost $140 million over ten years.

How to reconcile that cost is just one of the obstacles that the House and Senate must overcome before this extension finally becomes law.

But of course, it's taxpayer money that the Senators and Representatives are playing with so….

If the Senate can get the 60 votes necessary for the Reid-Baucus measure, then the unemployment and other provisions in that measure will have to ironed out with the House, which reportedly will again take up the unemployment issue today.

Read more about the House vote on extending the homebuyer credit in my previous post, The homebuyer credit: It's baaacckkk!.

And check back throughout the day to see what tax cards are dealt next.

Related posts:

• The homebuyer credit: It's baaacckkk!
• First-time homebuyer tax credit extension is no sure thing
• Senate tax extender changes: homebuyer credit extension,
  easing S Corp taxes?
• Tax extenders moving (maybe) in the Senate
• Tax policy and the American homeownership dream
• Putting the homebuyer credit to rest
• 'Successful, costly' first-time-plus homebuyer credit ending
• The federal homebuyer credit's 'exit strategy problem'

Want to tell your friends about this blog post? Click the Tweet This or Digg This buttons below or use the Share This icon to spread the word via e-mail, Facebook and other popular applications. Thanks!