By NAR 2013 President Gary Thomas
On April 15th, it’s a good time to remember something Will Rogers once said. He noted that, “the difference between death and taxes is death doesn’t get worse every time Congress meets.”
As the U.S. Congress considers action on comprehensive tax reform, you can be sure that NAR is doing its best to protect the many long-standing tax incentives to home and property ownership.
These include the following:
- mortgage interest deduction
- capital gains exclusion on the sale of a principal residence
- deduction for mortgage insurance premiums on private mortgage insurance and FHA-backed insurance
- state and local property tax deduction
- carried interest on commercial real estate
We’re going to have to stay on top of the action. These are complicated issues that will not be settled with a direct up or down vote that affects only real estate. They may easily be tucked into the language on a larger bill, and things may move very fast when the time comes.
Right now, we’re in the early stages of what we expect will be a long process. The House Ways & Means Committee and the Senate Finance Committee are holding ongoing meetings on the issues. As REALTORS®, we have a seat at the table and are sharing our views.
We tell members of Congress and staff how necessary these incentives are for rebuilding the national economy. Since we’re in the midst of a fragile recovery, additional housing taxes would crush the real estate market just as it is poised to help lift us out of the economic doldrums.
Our goal is to see that the tax code will continue to reflect the fundamental American value that homeownership helps build financial stability. Not only is this the right policy for housing, it’s also the best for families, for communities and the entire country.
Our government tax policy should encourage homeownership while giving more Americans a chance for their little piece of heaven. Support NAR and keep real estate tax incentives alive!
By Chris Polychron, First Vice President-Nominee, National Association of REALTORS®
As one educator said, “America is a land of taxation that was founded to avoid taxation.” So I think Tax Day is a good opportunity to talk about the tax benefits that go along with home ownership.
Since 1913, when the federal income tax became permanent, the tax code has offered a break for mortgage interest. This incentive to homeowners has reflected the high value that our nation places on homeownership due to the many financial and social benefits owning a home provides.
We believe these incentives should be protected because of the numerous financial and social benefits to the nation that are provided by homeownership. Even with these benefits, home owners currently pay 80 to 90 percent of the federal individual income taxes.
Let me mention a few of the financial benefits:
- Every home purchased pumps more than $60,000 into the economy for things like furniture and home improvements.
- Historically, a home owner’s net worth is 31 to 46 times that of a renter.
- For every two homes sold, one job is created.
- Housing is a key driver of our economy, accounting for more than 15 percent of the national Gross Domestic Product.
These benefits show the importance of housing as an engine of our economy.
On top of financial benefits, there are many social benefits:
- Home owners are happier and healthier.
- They participate more in their communities, including voting, volunteering and donating to charities.
- Their children stay in school longer and have higher test scores.
- Homeowners are less likely to be victims of crimes.
- They have a greater attachment to their neighbors and their neighborhoods, which fosters a greater sense of community.
This is just a partial accounting of the many social benefits that make our communities a better place to live and work.
While we don’t have to throw the tea in the harbor—yet—we can let our government representatives know strongly that we believe in the tax benefits provided to homeowners, particularly the mortgage interest deduction. As one former Secretary of the Treasury put it, “The nation should have a tax system that looks like someone designed it on purpose.”
So on this Tax Day, tell our leaders that we want to see the tax code continue to reflect the values of ordinary Americans, most of whom still consider home ownership to be a key part of the American Dream.
Death and taxes are certainties. Meanwhile, if you’re a homeowner, Tax Day doesn’t look so bad after all. And if you’re expecting a refund because of the MID—it can even become a day to look forward to.
What do we ask of you? Let me tell you. It will affect 47 million middle-class Americans who have a mortgage. It will affect the home prices of 75 million Americans who own their home. It will affect the neighborhoods and communities built on home ownership.
So what am I talking about?
We need you — our 1 million members of the National Association of REALTORS® — to let Congress know that trimming the mortgage intrestest deduction will hurt the middle class, who have been squeezed by this economic recession. It will hurt the housing market, which generates 2.5 million jobs and has a strong history of leading our country out of recessions.
I am passionate about protecting the dream of home ownership, the greatest way to a keep our families strong, and our nation stronger.
So, please, do it for you, do it for your clients, and do it for America! Tell Congress to preserve and protect the Mortgage Interest Deduction. Click here now to take action! – Moe Veissi, 2011 NAR President-Elect