The extension and expansion of the homebuyer tax credit is the pending business in the U.S. Senate.  After a long week of negotiation on the credit, an agreement on the scope of both expansion and extension has been reached.  The extension is part of a larger bill that has not yet gone to a vote; however, a Senate vote on the underlying bill will occur during the week of November 1, 2009.  The package will then go back to the U.S. House of Representatives where the House is expected to accept the Senate amendments, voter on the package and send it to the President for signature.  The underlying bill is an extension of unemployment benefits.  The agreement on the extension and expansion of the credit is as follows:
·        Credit available for purchases before May 1, 2010.  Prospective purchasers with binding contracts in place as of April 30, 2010 will be allowed an additional 60 days to complete the transaction.
·        Credit remains at $8,000 for first-time purchasers.  No change to definition of first-time purchaser.
·        New $6,500 tax credit for repeat buyers who purchase between December 1, 2009 and May 1, 2010.  Repeat buyers must have lived in their homes consecutively for 5 of the previous 8 years.
·        Income limits are expanded to $125,000 on a single return and $225,000 on a joint return.  Current law $20,000 phase-out on incomes higher than new income limits is retained.
·        New anti-fraud limitations are imposed.
The White House has indicated that President Obama will sign the legislation.