U.S. House Democrats are drafting a plan for curing the housing crisis by offering tax breaks to home owners, first-time homebuyers, and developers of low-income housing.

The plan, which will be unveiled this week, deliberately snubs the struggling home-building industry.

"We need to provide relief to the buyers and families themselves, not just the banks and builders," House Ways and Means Committee Chairman Charles B. Rangel (D-N.Y.) said yesterday in a written statement. "The House bill will put families first."

The House proposal would create a temporary tax credit of as much as $8,000 for first-time buyers and increase tax credits for investors in low-income housing. It would create a standard deduction for property taxes, aiding those who don’t itemize on their federal returns. And it would expand the authority of state and local housing finance agencies to use tax-exempt bonds to refinance troubled mortgages.

This package, together with the previous package of housing bills created by the House, would be the most far-reaching attempt by Congress to address the mortgage crisis. House leaders plan to present it to the full chamber for a vote in the next few weeks, says Rahm Emanuel (D-Ill.), chairman of the House Democratic Caucus. "There's a determination to get this done," he says.

Source: The Washington Post, Lori Montgomery (04/08/08)