Proposed Tax Code Reforms Could Harm Real Estate Recovery

According to the California Association of Realtors, in late June, the U. S. Senate announced plans to adopt a “blank slate” approach to reform the tax code.  A blank slate approach would eliminate all tax expenditures (including tax deductions such as the mortgage interest deduction, tax exemptions such as the capital gains exemptions on the sale of a personal residence, and the deduction of state property taxes).  Senators will have to request tax expenditures be added to the reform legislation, which would raise tax rates.  This approach allows the Senate Finance Committee to highlight just how much tax rates could be reduced by eliminating all the tax expenditures.  Senators have until July 26th to request that real estate expenditures be added to the reform legislation before the Finance Committee begins drafting a tax reform package.  What can you (we) do?  It is imperative that we have our voices heard and encourage Congress to “do no harm” to real estate.  Contact your representatives today.