Rep. Maloney and Assembly Member Epstein Release New Congressional Staff Report on how GOP Tax Scam Hurts New York Homeowners
NEW YORK—Today, Congresswoman Carolyn B. Maloney (NY-12) joined with tax experts and advocates to release a new report prepared by the Democratic Staff of the House Committee on Oversight and Government Reform that details how the Republican tax law is hurting New Yorkers in the 12th Congressional District. The report breaks down the new financial penalties facing homeowners, the estimated impact on New York and NY-12 homeowners specifically.
“The Republican tax scam is a travesty and is having a noticeable and negative impact on us right here at home,” said Congresswoman Maloney. “A home provides more than a place to live, it is often the centerpiece of a family’s nest egg and helps to provide financial security. But under this new tax law, some of that financial stability disappears as homeowners who use home equity loans for something other than home improvement will no longer be able to deduct their interest payments from their federal income taxes. The fortunate few and big corporations, however, have no such restrictions on how they can spend their $1.5 trillion tax cut. We cannot sit idly by while the GOP writes tax laws that benefit their friends while leaving American families to struggle without the fair deductions they have come to count on. That is why I am working on introducing legislation that would restore homeowners ability to use the home equity loan interest deduction for the purposes of paying medical expenses and education costs. Hardworking Americans need this flexibility to keep themselves afloat and their families thriving.”
“Republicans running for reelection have a lot to answer for: their corporate tax giveaway blindsides middle class families who have, for decades, had the expectation that they could borrow against their homes to pay for college tuition, student loans, medical bills, and other major life expenses, without being penalized,” said Assembly Member Epstein. “This new report shows just how seriously Trump’s plan to distribute wealth upwards harms east siders and other middle-class families across the country who will now have fewer practical ways to acquire low-interest loans.”
“The federal government isn't just hurting New Yorker's pocketbooks with the SALT deduction cap, it is also stifling the City's ability to staff schools, maintain parks and roads and provide so many other services which are funded through local taxes,” said homeowner Reshma Patel.
Despite Republican claims, their $1.5 trillion tax scam will not pay for itself, but rather will significantly increase the national debt and become an excuse for Republicans to push cuts to Social Security and Medicare.
"Home owners in NYC cooperatives and condominiums already contend with very high property taxes, said Mary Ann Rothman, Executive Director of Council of New York Cooperatives and Condominiums. “The limit on Federal deductions for these taxes could greatly increase the tax burden on many of these home owners."
“While most of the home owners in the co-op housing UHAB serves won't be impacted by the $10,000 limitation on state and local deductions, the GOP Tax Plan deprives nearly 3,000 families living in over 170 HDFC co-ops and over 10,000 households who reside in 17 Mitchell Lamas co-ops in District 12 of the opportunity usually afforded homeowners to deduct interest on home equity loans for education, new business, health care a car or other uses," said Andrew Reicher, Executive Director of Urban Homesteading Assistance Board.
“DCA prides itself on protecting and empowering the economic health of New Yorkers and no homeowner should face limitations regarding the financial security a home provides,” said NYC Department of Consumer Affairs Commissioner Lorelei Salas. “It goes without saying that purchasing a home is a major financial commitment and investment, and families should have access to deductions they’ve come to count on.
On December 22, 2017, President Trump signed the Tax Cuts and Jobs Act, which imposes significant new financial penalties on American homeowners across the country. This partisan bill was not supported by a single Democratic Member. Under the new law, homeowners can no longer deduct interest on home equity loans if they used the funds for anything other than home improvement. Up until now, home equity loans were often used to cover unexpected medical emergencies, to pay college tuition, or any other significant financial commitment that might otherwise require a high-interest loan to cover. Furthermore, homeowners can no longer deduct property taxes on their homes for the state and local (SALT) deduction over $10,000.
The report prepared for Rep. Maloney by the Democratic Staff of the House Committee on Oversight and Government reform found that:
- None of the approximately 101,000 homeowners currently living in New York’s 12th District will be allowed to claim deductions for interest on home equity loans they use for any purposes other than home improvement.
- Beginning in 2018, about 73% of homeowners in New York’s 12th District with existing home equity loans will not be allowed to claim full home equity interest deductions as they did in the past.
- 56% of homeowners in New York’s 12th District who used to be able to deduct their full property taxes will no longer will be allowed to do so.