Builders May Receive Cash Infusion From New Tax

While home buyer tax credit provisions received most of the attention, legislation passed by Congress yesterday also contains a generous tax provision that may give some midsized and large home building companies a much-needed cash injection in coming months. Specifically, The Worker, Homeownership, and Business Assistance Act of 2009, signed by the president earlier today, allows any business large or small to carry back losses five years. Only small businesses doing less than $15 million in revenue could do this previously. The bill permits builders and other companies to claim write-offs for net operating losses in either 2008 or 2009, but not both. Since most companies have already filed their 2008 tax returns, they could file for a refund almost immediately. But builders eager to get tax refunds may want to wait for the IRS to issue guidance on the carryback, according to industry tax experts. That guidance may make a difference over whether builders carry back their losses from 2008 or 2009.

Click here to view this article from its source.