Senate Bails Out the Rich Again
Conn Carroll /
The Senate voted Wednesday to renew the government’s $8,000 tax credit for first-time home buyers through the first six months of next year as part of a broader bill designed to extend unemployment benefits.
Heritage fellow Ronald Utt explains why this is terrible public policy:
Under the expiring law, the housing tax credit is available only to first-time homebuyers with annual household incomes no higher than $150,000 (for a married couple). Although an income of this magnitude puts the household comfortably within the top 20 percent of earners, census data show that the homeownership rate among households with incomes in excess of $100,000 is about 88 percent, meaning that few in this income class would qualify as first-time buyers.
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Senator Isakson’s proposal would make sure that the next government-subsidized rising tide lifts not just the little boats but the sleek yachts too, so he has proposed that the $8,000 housing tax credit be extended until June 2010 and that eligibility be expanded to include (1) households with incomes of up to $300,000 (for a married couple) and (2) those who already own a home. (more…)