Tax Plan Could Help More Everyday Americans Afford a Place to Call Home
On April 26, 2017, President Trump proposed his tax plan.
With his proposed tax plan, President Trump missed a significant opportunity to re-balance federal housing policy.
An alternative plan to re-balance federal housing policy could help more everyday Americans – homeowners and renters alike – afford a place to call home.
The Trump tax plan would make the mortgage interest deduction (MID) even more regressive, benefiting only the wealthiest Americans. Instead, his plan could have embraced the smart, modest United for Homes campaign that reforms the mortgage interest deduction (MID) – a $70 billion tax write-off that largely benefits higher income households – that would give tax relief to 15 million more low and moderate-income homeowners.
Rather than reinvesting the savings from MID reform to help our nation’s most vulnerable renters who struggle to pay their rent each month, the tax plan uses housing dollars to pay for lowering tax rates for millionaires, billionaires and corporations.
Diane Yentel, President and CEO, of the National Low Income Housing Coalition (NLIHC) said in a press statement, “If Mr. Trump is serious about putting forward tax reform proposals to spur economic growth and help everyday Americans who have been left behind, he has sorely missed the mark.”
NLIHC urges President Trump and Congress to seize this opportunity to make the critical housing investments that America’s families and local communities need to thrive.
On April 26, 2017, NJ.com reported “Trump tax plan would sock N.J. by killing property tax deduction.” Reporting on President Trump’s plan, “A tax cut plan proposed by President Donald Trump’s administration Wednesday would eliminate the federal deduction for state and local taxes, a blow to New Jersey residents who pay the highest property taxes in the nation.
Trump’s chief economic adviser, Gary Cohn, said that deductions for charitable contributions and mortgage interest would be the only ones retained for individual taxpayers.”
Unfortunately, the tax proposal does not help those in New Jersey who need help the most.
“Cohn said that the plan was designed to help lower and middle-income Americans, but in actuality it repeals those levies that almost exclusively fall on the richest taxpayers, as well as reduces their top tax rate to 35 percent from 39.6 percent.”
Many low-income New Jerseyans rely on Medicaid for their health insurance.
“It also would repeal the 3.8 percent Medicaid tax levied only on individuals with at least $200,000 in investment income and married couples with $250,000. That money helps fund the Affordable Care Act, which extended coverage to more than 20 million Americans.”
The House voted to repeal and replace the Affordable Care Act last Thursday. The Medicaid tax was part of the repeal.