National News
In October, both the U.S. House of Representatives and Senate passed an agreement for a $4.1 trillion budget which, among other things, allows Congress to unveil the language to the long-awaited tax reform package. Lawmakers will attempt to restructure the nation’s tax code by doubling the standard deduction and eliminating all deductions except for the mortgage interest deduction (MID) and charitable deductions.
Although this may sound good on the surface, the proposal actually takes the teeth out of the MID by eliminating the state and local tax deduction and property tax deduction.
A study conducted on behalf of the National Association of REALTORS® by PricewaterhouseCoopers revealed that 88% of homeowners who claim the MID earn less than $200,000 and homeowners already shoulder 83% of the federal taxes. By eliminating the state and local tax deductions, homeowners would be unfairly subjected to double taxation. If passed, PwC’s study projects a 15% drop in home values nationally and could have a destabilizing effect on communities already struggling to provide services and support their schools.
To illustrate the the impact of this proposed legislation, one can look at the recent numbers. In 2015, the average taxpayer living in Montgomery, Greene, and Fayette counties (10th Congressional District represented by Congressman Mike Turner) claiming the mortgage interest deduction and real estate tax deductions was able to subtract $5,568 and $4,321, respectively, from taxable income. A total of 81,399 residents claimed the real estate tax deduction, while 80,879 residents itemized state and local taxes and saved an average of $6,262.
As tax reform moves forward, it is imperative that our House and Senate leaders know that tax reform shouldn’t be accomplished on the backs of homeowners. You can do your part in participating in NAR’s Call for Action.
DABR CEO Andrew Sims wrote about the importance of REALTOR® engagement with our leaders on this topic. Read article and take action
Local News
Your Dayton Area REALTORS® PAC met with candidates for various offices in the Dayton area and chose to offer financial support to some of those campaigns. Members who live in the cities and townships where DARPAC-supported candidates are running should look forward to receiving a voter guide in the mail.
