Senate Republicans on Dec. 2 passed the Tax Cuts and Jobs Act (H.R. 1), moving forward a legislative effort to revise the tax code. The Senate bill has improvements when compared to the House version of H.R. 1, which has been opposed by NAHB.
The Senate's version keeps the mortgage interest deduction cap at $1 million. The House bill lowered the cap to $500,000. The Senate version also retains the mortgage interest deduction for second homes. It excludes a punitive income phase-out, proposed by the House, as part of the changes to the capital gains exemptions for the sale of a primary residence. Like the House bill, the Senate version retains the Low-Income Housing Tax Credit in its current form, but unlike the House bill, it would keep private activity bonds. Also included in the Senate tax reform bill is an NAHB supported amendment that will allow home owners to deduct up to $10,000 in property taxes. The Senate bill also offers more parity in how pass-through businesses are treated relative to C-corporations.
The legislation is now in a House and Senate conference committee to work out differences for the final package. The Association is urging Congress to adopt those key Senate provisions, as well as a House position to eliminate the alternative minimum tax.
NAHB is urging members to join the fight for a tax package that offers the best outcome for home owners, renters and small businesses.
Click Here for an update from NAHB that includes a link to the CapitolConnect, the legislative tool that allows members to take action and urge Congress to include the provisions that protect home ownership and housing affordability.