WASHINGTON, D.C.- President Trump’s proposal for tax reform is a missed opportunity to reprioritize and rebalance federal housing policy. By raising the standard deduction, Mr. Trump’s tax plan would lead to fewer households claiming the mortgage interest deduction (MID) – a $70 billion tax write-off that primarily benefits higher income households. Without additional reforms to provide a greater tax benefit to low and moderate income homeowners and to reinvest the savings into providing affordable rental homes to those with the greatest needs, Mr. Trump’s proposal would amplify MID’s regressive effect; only the wealthiest Americans would benefit.
The National Low Income Housing Coalition’s United for Homes campaign calls on the president and Congress to embrace smart, direct reforms to the MID. This includes reducing the amount of a mortgage eligible for a tax break from $1 million to the first $500,000—impacting fewer than 6 percent of mortgage holders nationally—and converting the deduction into a credit, creating a new tax break for 15 million low and moderate income homeowners who currently do not benefit from the MID. This would result in $241 billion in savings over 10 years to be reinvested into critical rental housing solutions, like the national Housing Trust Fund and rental assistance, for families with the greatest needs – not to pay for lowered tax rates for billionaires and corporations.
Having an affordable place to call home transforms lives—giving people the stability they need to achieve economic mobility, improve their health, and allow children do better in school—and an investment in affordable homes creates jobs and strengthens communities.
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.
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Established in 1974 by Cushing N. Dolbeare, the National Low Income Housing Coalition is dedicated solely to achieving socially just public policy that assures people with the lowest incomes in the United States have affordable and decent homes.