The House unanimously passed a tax relief bill for veterans yesterday that would, among other items, make qualified mortgage revenue bonds available to them on a permanent basis and quadruple the amounts of such bonds that can be issued in Alaska, Oregon, and Wisconsin.
The Heroes Earnings Assistance and Relief Tax, or HEART, Act of 2008 would provide a number of tax breaks to veterans of America's armed forces.
HR 6081 was roundly praised by House members, including Ways and Means chairman Charles Rangel, D-N.Y., who is a sponsor of the measure.
"This bill enhances their ability to get tax benefits such as the earned income tax credit, buy homes, make penalty-free withdrawals from their pension plans, access amounts held in flexible savings accounts, and remove other impediments that keep them from getting the relief they deserve," he said in a statement.
Under the bill, state housing agencies can issue tax-exempt mortgage revenue bonds and use the proceeds to finance lower-rate mortgages for veterans on a permanent basis. A previous program had been established, but it expired on Jan. 1, 2008.
Also, the bill would quadruple the amount of qualified mortgage bonds to $100 million from $25 million per year that Alaska, Oregon, and Wisconsin could each issue to help veterans purchase homes.
When the Tax Reform Act of 1984 was passed by Congress, it prevented the creation of new mortgage bond programs for veterans. However, five states - Alaska, California, Oregon, Texas, and Wisconsin - previously had established programs, which were grandfathered under that law.
Under their programs, California and Texas were only permitted to offer bonds to veterans who served in active duty before Jan. 1, 1977. As a result, only Alaska, Oregon, and Wisconsin can still issue certain amounts of such bonds for veterans. A bill that would have removed the deadline for California and Texas, HR 3997, was never acted on by Congress.
Hill sources said that the Senate is expected to either introduce and vote on its own veterans tax bill, or simply consider the House bill, sometime next week.