COBRA, Unemployment, and First Time Home Buyers Benefits Extended

COBRA and Other Benefits Extended

12/28/2009

As part of the Defense Appropriations bill signed into law on December 19, Recovery Act funds will continue to subsidize 65 percent of COBRA health insurance premiums for certain unemployed individuals. The subsidy program, which originally covered the period between February 17 and November 30, 2009, now runs through February 2010 for people who lost their jobs through no fault of their own between September 1, 2008, and February 28, 2010. 
The Department of Labor website has more details.
Also, with enactment  on November 6 of the Worker, Homeownership and Business Assistance Act of 2009, three other key provisions of the Recovery Act were either extended or expanded.
Emergency Unemployment Compensation
This legislation added another 14 weeks of unemployment benefits. In states exceeding an 8.5 percent unemployment rate (currently 26 states), an additional six weeks of benefits are available, for a total of 20 weeks. In all cases, the $25 in Recovery funds added to each regular benefit payment also continues.

Contact your state unemployment office for details.

First Time Homebuyer Credit
The original provision – a tax deduction of up to $8,000 – applied only to people buying their first homes between April 8, 2008, and December 1, 2009. The cut-off date has now been extended to April 30, 2010. Also, a similar credit – up to $6,500 – is now available to current homeowners who buy new principal residences in the same time frame. However, those homeowners must have lived in their previous homes for a five-year consecutive period in the previous eight years before the date they buy the new home.

For either credit:
• New home can cost no more than $800,000
• Individual buyers must have income of $125,000 or less
• Joint tax-filers must have combined income of $225,000 or less
The IRS has more information here