Updated: Illinois REALTOR® takes fight over tax reform to Capitol Hill today

 

REALTOR® Mike Drews meets with U.S. Rep. Randy Hultgren in Washington, D.C., to discuss tax reform proposals which could hurt Illinois property owners.

Illinois REALTORS® past president Mike Drews is in Washington, D.C., today to press the case for responsible tax reform.

Drews is visiting the Hill as part of an effort to make sure Illinois lawmakers know that the current House version of a tax code overhaul would unfairly hurt property owners in Illinois by eliminating tax deductions and ultimately lowering home prices by as much as 10 percent.

Drews is a Federal Political Coordinator for U.S. Rep. Randy Hultgren. FPC’s, as they are called, serve as a valuable conduit for information between REALTORS® and federal officials.

Drews said Hultgren was interested in the data REALTORS® provided. “We gave him a lot of information,” Drews said of the Tuesday morning meeting.

The visit is part of a nationwide push on the part of REALTORS® to make sure the message gets through to the House members who could vote later this week on a package of reforms.

Nearly 30 percent of Illinois REALTORS® have responded to a Call for Action urging lawmakers to proceed with care when reforming the tax code. (Take part here).

REALTORS® are not against tax reform, but are concerned about protecting the Mortgage Interest Deduction and deductions for state and local taxes. As drafted, the proposal now would:

  • Increase the standard deduction on  tax returns, which could put home ownership incentives beyond the reach of many families.
  • Limit capital gains from the sale of a primary residence. Homeowners would have to live in a property five of eight years, rather than the current two of five years to realize this benefit.
  • Important deductions disappear, most notably the state and local tax deduction, which would unfairly hit a high-tax state such as Illinois. The loss of deductions ranging from interest on student loans to medical expenses to even moving expenses further chips away at home ownership.

 

 

 

Tax reform plan would hurt homeowners, REALTORS® tell Sen. Durbin

Illinois REALTORS® met with Sen. Dick Durbin, D-Ill., on Monday to discuss how a proposed tax reform plan would hurt Illinois property owners. REALTORS® Sue Miller and David Hanna represented the association. Photo: Conor Brown

Illinois REALTORS® met with U.S. Sen. Dick Durbin on Monday to tell him how a proposed tax overhaul would hurt homeowners.  

Illinois REALTOR® Sue Miller discusses the impact of a tax reform plan with members of the media at a press conference in Crystal Lake, Ill., on Monday, Nov. 6, 2017. From left are: Heartland REALTOR® Organization CEO Jim Haisler, U.S. Sen. Dick Durbin, Miller, McHenry County Board Chair Jack Franks, Homebuilders Association of Illinois Vice President Bill Ward and REALTOR® Dave Hanna. Photo: Conor Brown

REALTORS® Sue Miller and David Hanna told Durbin that as drafted the bill would have huge impact Illinois, which has some of the highest property taxes in the country.

Illinois REALTORS® delegation was introduced by Jim Haisler, CEO of the Heartland REALTOR® Organization.  Illinois REALTORS® Local Government Affairs Director Conor Brown and Bill Ward with the Homebuilders Association of Illinois attended the session.

The current version of the tax plan caps the deduction for property taxes at $10,000, a move that would hurt many in high property tax areas such as McHenry County.  

McHenry County Board Chairman Jack Franks told Durbin that the $10,000 cap would result in a tax hit even for those who own relatively modest homes.   

The National Association of REALTORS has voiced strong opposition to the bill as drafted. While the organization states it is not against tax reform, the way the legislation has been drafted would hurt property owners and decrease home values.  

Among concerns is a mortgage interest deduction limit of $500,000, an amount that is not indexed to inflation. That means the policy’s impact on property owners will continue to worsen over time.  

Other elements of the plan are worrisome, too.

In addition to doing away with the deduction for state and local taxes, mortgage interest deductions for second homes would go away, as would deductions for interest on student loans and medical expenses.  

Media outlets covered a press conference after the meeting in Crystal Lake. Durbin shared his concerns about the tax reform plan.

According to Crain’s Chicago Business, Durbin said

Eliminating or gutting state and local tax deductions will hit Illinois hard—resulting in double taxation for a third of the families in our state.” 

 

REALTORS® discuss tax reform impact with Sen. Duckworth

Illinois REALTORS® had a chance to brief U.S. Sen. Tammy Duckworth on their concerns about proposed tax reform at a meeting on Sunday in Barrington. Photos: Brian Bernardoni.

Illinois REALTORS® met with U.S. Sen Tammy Duckworth on Sunday to outline concerns about the affect proposed tax law changes might have on homeowners.

Illinois REALTORS® President-elect Dan Wagner listens to Sen. Tammy Duckworth at a meeting on Sunday.

Duckworth met with REALTORS® including association President Matt Difanis and President-elect Dan Wagner. Also attending was REALTOR® Nancy Suvarnamani, who serves as the association’s federal political coordinator for Duckworth, and Brian Bernardoni, senior director of government affairs and public policy working with the Chicago Association of REALTORS®.

The meeting was held at Barrington Village Hall.

The first details on the tax reform bill are expected to be released this week, and REALTORS® are worried that the proposal may eliminate or water down the Mortgage Interest Deduction and taxpayers’ ability to deduct state and local taxes.

Eliminating or weakening the Mortgage Interest Deduction (MID) could have a profound impact on property owners nationwide, as it serves as a major incentive for buyers to own rather than rent. MID is critical for many first-time homebuyers, and has been a major driver in the real estate industry for more than 50 years.

The elimination of the state and local tax deduction would be felt particularly hard in Illinois, a state which has some of the highest property taxes in the nation.

Call for Action: Do your part to protect homeownership

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Encourage Congress to reform our tax code and protect middle class homeowners in the process by taking part in an NAR Call for Action which starts today.

Ask your federal lawmakers to make sure the tax reforms they consider will treat homeowners fairly, reverse the decline in first-time home buyers, not cause another housing crash and preserve like-kind exchanges. Proposals that repeal or weaken tax incentives for homeowners, according to analysis from PricewaterhouseCoopers shows that middle-income families ($50,000 to $200,000) could be worse off – paying an average of $815 more taxes and taking on a larger share of the nation’s tax burden.

Although the nation’s tax code has encouraged homeownership, proposals that limit interest and property tax deductibility would reverse this course. A recent proposal to eliminate the mortgage interest deduction and the deduction for state and local property taxes could have negative effects on the housing industry, which saw the number of first-time home buyers at a 50-year low in 2016.

In Illinois, where 65 percent of homeowners had a mortgage in 2014, about 1.5 million taxpayers claimed the mortgage interest deduction and saved nearly $2.9 million in taxes. That was an average of $1,930 per taxpayer. About 1.8 million taxpayers claimed the real estate tax deduction, saving a total of nearly $2.9 million, or $1,620 a person, according to NAR calculations.

Do your part by following directions outlined in REALTOR® Party mobile alerts, emails or by going to the REALTOR® Party webpage to send messages to policymakers. In previous Calls for Action, more than 20 percent of Illinois REALTORS® membership has participated.

The more REALTORS® respond to the Call for Action, the stronger the message to elected officials.

Get more information on this issue.

REALTOR® association helps Lockport with grant for pedestrian plan

(l to r) Three Rivers Association of REALTORS® CEO David McClintock, Renee Saban (Lockport city council), Joanne Bartelsen (Lockport city council), Three Rivers President Matt Persicketti, Steven Streit (Lockport Mayor) and Three Rivers Secretary-Treasurer Ken Pytlewski.

The Three Rivers Association of REALTORS® presented Lockport officials with a $5,000 donation last week to help the city’s pedestrians.

The local REALTOR® association secured the funds through the National Association of REALTORS®’ Smart Growth Action Grant program. Three Rivers’ President Matt Persicketti and Secretary/Treasurer Ken Pytlewski spoke during a Lockport City Council meeting.

“As part of our local community involvement, the Three Rivers Association of REALTORS® prides itself on securing National Association of REALTOR® grants for projects that line up with the vision local leaders have for their communities,” said Persicketti.

“Lockport has excellent transportation assets with a Metra stop, access to Interstate 355 and the I&M Canal Trail,” said Pytlewski. “The pedestrian plan update is a great way to add character and value to an already great town.”

Lockport boasts a network of bike trails and roadways and access to major tollways and commuter rail service. Recent growth and the potential for more development, however, uncovered the need for changes to the city’s pedestrian plan, which was last updated in 2003. The plan provides a guiding document that city officials and residents can use for future pedestrian infrastructure development. Pedestrian plans are crucial tools for creating desirable, livable communities that preserve historical elements while embracing growth. Pedestrian amenities can also improve property values.

The NAR Smart Growth Action Grants encourage REALTOR® participation in community and economic development. Three Rivers is a non-profit organization that represents more than 900 members in Will and Grundy counties dedicated to professional and ethical service to their real estate clients.