TOPICS > Economy

Aid for Jobless, Homebuyers Clears Congress

BY Dave Gustafson   November 5, 2009 at 10:39 AM EDT

Unemployed Coloradans at job fair; Getty file photo

The $24 billion economic package, which would also broaden tax breaks for businesses, cleared the House Thursday afternoon in a 403-12 vote and heads to President Barack Obama to sign into law. It passed 98-0 late Wednesday in the Senate.

Under the measure, the $8,000 tax credit for first-time homebuyers would be lengthened by seven months and expanded with a $6,500 credit for some prospective homebuyers who already own homes.

The nearly 2 million people who have lost or are in danger of running through their unemployment benefits before the end of 2009 would receive up to 20 weeks in additional benefits.

For those in states with unemployment rates above 8.5 percent, it would grant an additional six weeks on top of that. The extension is the fourth since last June, and could give some people up to 99 weeks of unemployment benefits, above the previous record of 65 weeks set in the 1970s, according to the Associated Press.

In figures released Thursday, the Labor Department said that first-time claims for jobless benefits fell by 20,000 to a seasonally adjusted 512,000.

“We know that when an economy recovers, the unemployment rate is one of the last numbers to rebound,” said Senate Majority Leader Harry Reid, D-Nev., according to the Washington Post. “So even as our economy begins to turn around, jobs are turning around slower, and it is our responsibility to ensure the out-of-work are not left out in the cold.”

The popular $8,000 tax credit for first-time homebuyers, which was originally enacted in February as part of the $787 billion stimulus legislation, had been scheduled to run out at the end of this month.

The real estate industry has been pushing to extend and expand the housing tax credit. About 1.4 million first-time homebuyers have qualified for the credit through August, according to the AP.

The new legislation would also extend a $6,500 credit to homebuyers who have lived in their current home at least five years and want to buy a new one.

“This is probably the last extension,” said Sen. Johnny Isakson, R-Ga., a former real estate executive who has supported the credits.

The bill would also allow people whose businesses experienced losses in 2008 and 2009 to file for tax refunds on profits they had made in the past five years.