Rebates for home builders weighed

Jeff Tyler Apr 23, 2008


Renita Jablonski: In the wake of the subprime mortgage meltdown, Congress is considering some tax relief. This one isn’t for homeowners. Instead, it would help home builders through what is, in effect, a tax rebate. Not everyone likes the idea, as Marketplace’s Jeff Tyler reports.

Jeff Tyler: The bill would extend the so-called “net operating loss carry-back rule.” It would allow home builders to apply current losses to tax returns going back four years. By applying those losses to years when business was good, companies could get significant rebates from Uncle Sam. Terry O’Sullivan is general president of the Laborers’ International Union of North America. The union opposes tax relief for corporate home builders.

Terry O’Sullivan: In 2006, they had a $100 billion in revenue, of which they made $16 billion. And two years later, they’re standing in line like pigs at the trough, asking for billions of dollars in a taxpayer handout.

O’Sullivan says the builders are partly to blame for the housing bubble, since many of these companies also made subprime loans. The bill has already passed the Senate. Now it moves to the House.

I’m Jeff Tyler for Marketplace.

We’re here to help you navigate this changed world and economy.

Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.

In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.

Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.