Congress extends jobless benefits, tax credits

Rocky Mount employment officials and area Realtors praised a measure by Congress this week that would expand a popular homebuyers tax credit and extend unemployment checks to the growing number of job seekers running out of benefits.

The U.S. House passed the bill on a 403-12 vote Thursday, a day after the U.S. Senate ended a monthlong stalemate with a 98-0 vote. With some 7,000 people exhausting unemployment benefits every day and the $8,000 tax credit for first-time homebuyers set to expire at the end of November, President Barack Obama is expected to quickly sign it into law.

The $24 billion package also contains tax credits aimed at struggling businesses.

Rocky Mount employment officials said it was unclear how many unemployed area residents would be impacted by the legislation, which would extend jobless benefits an additional 20 weeks for residents in states hardest hit by the recession.

Unemployment in the Rocky Mount metro area was 13.4 percent in September.

“Once the bill is signed by the president and comes down, then our folks will begin the programming and sending out letters to those who are eligible,” said Steve Rogers, the manager of the N.C. Employment Security Commission office in Rocky Mount. “This won’t be an overnight thing. People who are potentially eligible will be hearing from our office if it’s signed so we can start processing.”

The IRS says some 1.4 million people applied for the homebuyers credit through August, helping boost the struggling housing market. The legislation passed Thursday would extend the program through June of next year, as long as the buyer signs a contract by the end of April. It also offers a $6,500 tax credit to homebuyers who have lived in their current residence at least five years.

“I think that’s the most important thing, extending the tax break out beyond just first-time homebuyers,” said Doug Bullock, president of the Rocky Mount Area Association of Realtors. “I think most of the folks looking at using the credit have already used it. It certainly has helped sales in Rocky Mount.”

Bullock said the $6,500 credit has the potential to push a lot of homeowners into the market for a new home. Mayor David Combs, though, said he sees more potential in the first-time buyers credit. Either way, both applauded the measure.

“This credit isn’t the answer to all the problems of the housing market, but I think that it has been a definite boost here in Rocky Mount and nationwide,” said Combs, president of Century 21 The Combs Co.

The bill also would allow businesses that have incurred losses in 2008 and 2009 to seek refunds for taxes paid on profits over the past five years.

The extension of unemployment benefits would be the fourth since June of last year and the first since the $787 billion stimulus package was enacted last February. The unemployed in the hardest-hit states could, once the bill becomes law, receive a maximum of 99 weeks of benefits, well above the previous record of 65 weeks in the 1970s.

U.S. Sen. Kay Hagan, D-N.C., touted the legislation Wednesday during a conference call with North Carolina reporters, saying the extension would be critical in maintaining stability in the economy as jobs begin to return.

“When I’m back in North Carolina, I meet so many homeowners, business owners and middle-class families who are hurting in this economic climate,” Hagan said.

The $2.4 billion cost of extending unemployment benefits is offset by extending through June 2011 the federal unemployment tax that employers pay for each employee.

The three measures would add $43 billion to the 2010 deficit and then be repaid over time.

Information from The Associated Press was included in this report.