Voters in New York’s 23d have received a third glossy mailing from the National Association of Realtors (NAR) on behalf of our congressman, Rep Tom Reed. These misleading pamphlets must be costing the association a bundle.
What is it about Tom Reed that the powerful lobby finds so attractive? This blog has speculated that it’s Reed’s support for repealing the Alternative Minimum Tax. Repeal would give a big new tax deduction to wealthy purchasers of expensive homes, so it’s not surprising (though a little disappointing) that the realtors’ organization favors it. The industry may also think of Reed as a friend because he’s one of the fortunate few able to take advantage of the loophole that allows a mortgage interest tax deduction on a second home. The industry strongly supports this loophole, and since Reed serves on the Ways and Means Committee, which writes the tax laws, he’s in a position to help protect it.
The most recent NAR mailing praises Reed for “preserving the federal property tax deduction.” This deduction allows taxpayers who itemize to deduct their state and local taxes from the income they report to the Internal Revenue Service. It’s a particular boon to the well off, who pay the highest property taxes. (Of course, if their property tax deduction is unusually high, they may fall prey to the Alternative Minimum Tax, but that’s another story.)
Here’s the odd thing. The only serious proposal around that would do away with the federal property tax deduction is the Tax Reform Act of 2014, a substantial overhaul of the tax code proposed by Reed’s fellow Republican, Rep. Dave Camp, chair of Reed’s own Ways and Means Committee.
Tom Reed has told the voters of New York’s 23d that the Dave Camp tax reform is good for them and that he supports it. Yet the National Association of Realtors hates Camp’s proposal, which would also limit the availability of the mortgage interest deduction to those who have borrowed less than $500,000 rather than $1 million as is presently the case.
Speaker Boehner has declined to endorse the Camp tax reform, which includes provisions that would be an albatross around his party’s neck in the 2014 congressional elections. Everyone knows the Camp reforms are going nowhere.
Still, voters in New York’s 23rd should ask themselves a question. Why is Reed receiving heavy backing from the National Association of Realtors, when he has told voters that he supports the Dave Camp reform that is anathema to the NAR? Is the NAR unaware of Reed’s stance in favor the Camp proposal? Or does the NAR have reason to believe that what Reed tells the voters does not reflect his true position?