On June 27, the leadership of the Senate Finance Committee announced that it will begin a new effort to reform our tax laws. These changes could dramatically impact how supportive housing is funded.
Chairman Max Baucus (D-MT) and Ranking Member Orrin Hatch (R-UT) solicited the priorities of their Senate colleagues and indicated they’d be using a "blank slate" approach to tax reform. The Senators stated that all credits and deductions would be removed from the code "unless there is clear evidence that they: (1) help grow the economy, (2) make the tax code fairer, or (3) effectively promote other important policy objectives." It is up to individual Senators now to weigh in with the Senate Finance Committee on their preferences for what portions of the tax code should remain, be changed, or be added.
CSH is very interested in the Committee’s efforts for two primary reasons:
- The most important capital source for creating supportive housing – the Low Income Housing Tax Credit – is in jeopardy if it is not included in the new code. New Markets Tax Credits also face the same risk.
- The opportunity to reform the tax code to provide critically needed new incentives and funding sources for affordable housing. Creating a Renters Credit is an innovative and worthwhile proposal, as is reforming the Mortgage Interest Deduction to fund the Affordable Housing Trust Fund.
CSH encourages developers, affordable housing advocates, homeless service providers and others to reach out to their Senatorsright away about the importance of housing tax credits and the value of having a Renters Credit or a reformed MID to fund the Affordable Housing Trust Fund. The Committee requested responses by July 26th but offices will be finalizing their lists prior to that date. Because many Senators “support” the tax credit, we encourage advocates to not simply accept that they are supportive, and rather to go a step further and get a commitment that the Senator will include these proposals in a letter to the Senate Finance Committee.
More information can be found here:
