Administration Tax Reform Plan Caps Mortgage Interest Deduction at First $500,000
Once the House passes its spending bills, it will turn its attention to tax reform legislation, a top priority for Republicans in Congress and the White House.
The National Low Income Housing Coalition (NLIHC) reports that party leaders have set an ambitious goal of enacting tax reform legislation before the end of the year.
In recent weeks, the White House has discussed possible reforms to the mortgage interest deduction (MID), a $70 billion tax expenditure that disproportionately benefits higher income homeowners.
The administration is considering capping the tax deduction at the first $500,000 of a mortgage rather than the first $1 million, the current threshold – a change that aligns with one of the proposals of the NLIHC-led United for Homes campaign.
While NLIHC and United for Homes call for reinvesting the significant savings from MID reform into affordable rental homes for people with the greatest needs, through solutions like the national Housing Trust Fund or rental assistance, the administration and Congressional Republicans propose using any savings to offset the cost of lowering tax rates for millionaires and corporations.
It is critical that any tax reform legislation keep housing dollars within housing and reinvest savings from MID reform into programs that address the growing rental housing crisis for those with the lowest incomes.
NLIHC encourages advocates to call their members of Congress in support of the United for Homes proposal to help end homelessness and housing poverty in America. You can use this link for phone numbers and emails for your members of Congress.
United for Homes was created to end homelessness, help build a strong foundation and strengthen communities. Families–and especially children–who live in a stable, affordable homes have better health and education outcomes, have greater access to economic opportunities, and benefit from stronger communities.
United for Homes urges reform of the mortgage interest deduction (MID)—a $70 billion a year tax write-off that largely benefits America’s highest income families—and a reinvestment of the savings in housing that serves families with the greatest, clearest, most pressing needs through solutions like the national Housing Trust Fund (HTF) and rental assistance programs.