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Statement by Ann Ashburn
AmeriDream, Inc. President & CEO

AmeriDream Statement on the IRS Revenue Ruling 2006-27

We are troubled and concerned by the recent IRS Revenue Ruling 2006-27, which states that some non-profit organizations that provide down payment assistance to homebuyers do not qualify as tax-exempt charities.  AmeriDream believes the IRS’s interpretation of the tax code is erroneous but we will review our operations to see how we can comply with the revenue ruling.
While the IRS announcement is confusing, it is our understanding that AmeriDream still retains its exemption under section 501(c)(3) of the tax code and is classified as a public charity.  According to HUD representatives, AmeriDream continues to meet HUD guidelines as an acceptable source for down payment assistance until the IRS issues a specific revocation of AmeriDream’s tax-exempt status.  Therefore, AmeriDream is allowed to continue to operate our down payment assistance program until we receive notice from the IRS that AmeriDream is no longer tax-exempt. 
AmeriDream remains committed to doing what is right for America’s homebuyers and has helped over 175,000 individuals and families become homeowners.  We have attempted to work with HUD, the IRS and Congress to ensure the advancement of homeownership in accordance with our charitable mission and the government’s charge to serve those most in need of homeownership. For the past three years, we asked the IRS on numerous occasions for guidance regarding the non-profit down payment assistance sector; our efforts were rebuffed or ignored.  Now that the IRS’s position has been declared, we will review our operations to see how we can continue to provide homeownership to those most in need and comply with the revenue ruling.

A government study reported that nearly 40% of FHA homebuyers rely on down payment assistance organizations to become homeowners.  Ultimately, the IRS ruling will affect low to moderate-income individuals and families, many of whom are first-time, minority and working class homebuyers, and limit their ability to purchase a home.  AmeriDream believes the IRS rule change will have a negative impact on not only American homebuyers but also the housing industry and the national economy.  The May 4th announcement by the IRS will deprive millions of individuals and families of a chance to achieve their dream of homeownership and will jeopardize the overall national economy.

If you are concerned about the negative impact that this revenue ruling will have on your mortgage lending business, real estate business, title service business, or if you are a homebuyer that could now be locked out of homeownership, the Department of Treasury needs to hear from you.  Tell them that Revenue Ruling 2006-27 is bad tax law and should be changed to allow down payment assistance programs to operate on a service fee basis from seller participation.  Please call Susan Brown, Attorney Advisor -- Regulatory Affairs, Department of the Treasury, (202) 622-0999.

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About AmeriDream

AmeriDream, Inc., is a non-profit 501(c)(3), publicly supported organization founded in 1999.  AmeriDream is one of the first organizations to pioneer providing down payment assistance to low-and moderate-income individuals and families to become homeowners. Through AmeriDream’s Downpayment Assistance Program, the organization has helped over 300,000 people buy and sell their homes. These homeowners have generated over $20 billion in real estate sales.  To learn more about AmeriDream please go to www.ameridream.org.