Reforming the Mortgage Interest Deduction

As part of my commitment to addressing the housing crisis and ensuring every American has access to affordable housing, I believe we need to rethink the way the federal government supports housing through the tax code. The Mortgage Interest Deduction (MID) has long been a fixture of tax relief for homeowners, helping millions of middle-class families purchase and retain their homes. However, it’s clear that this deduction disproportionately benefits wealthier homeowners and often leaves renters and low-income Americans out in the cold.

While I do not support the outright elimination of the Mortgage Interest Deduction, as it remains an important tool for many families across the country, I instead propose a reform that strikes a balance between protecting middle-class homeowners and addressing the urgent need for affordable housing:

  1. Capping the Mortgage Interest Deduction: I support implementing a cap on the deduction, ensuring that it remains available to the vast majority of middle-class homeowners, while limiting excessive benefits for higher-income earners. This will help ensure that the deduction serves those who truly need it and does not become a tax break for the wealthiest Americans.
  2. Phasing Out the Deduction for Second Homes: The current deduction allows individuals to claim mortgage interest on second homes or vacation properties. I believe this is unnecessary, especially in the face of a national housing crisis. Phasing out this deduction for second homes will generate significant savings that can be reinvested in programs designed to help those struggling to afford housing.
  3. Redirecting Savings to Affordable Housing Programs: The savings generated from capping the deduction and phasing out second home benefits should be reinvested into expanding Section 8 housing vouchers, affordable housing construction, and tax incentives for developers who build affordable housing units. These programs will ensure that more Americans, particularly low-income families, have access to safe, affordable homes.

This reform will help address the growing inequality in our housing system, where renters and low-income families face rising rents and limited affordable options, while wealthier individuals benefit from tax breaks for second homes. By capping the deduction and phasing out unnecessary benefits, we can redirect federal dollars to where they are most needed: creating and supporting affordable housing opportunities for all Americans.

With these reforms, we can ensure that the mortgage interest deduction continues to benefit the middle class, while also addressing the pressing need for affordable housing. This balanced approach will protect current homeowners, invest in housing for the future, and ensure that our tax system works for all Americans, not just the wealthiest among us.

Earned Income Tax Credit (EITC)

The Earned Income Tax Credit (EITC) is one of the most effective tools in fighting poverty, providing working-class families with direct financial relief. However, I believe it can be further expanded and reformed to better serve struggling households and boost economic mobility.

I will fight for:

  • Expanded EITC Eligibility: Broaden eligibility for the EITC to include more low-income workers without children and young adults aged 18-24 who are currently excluded from receiving benefits. This would help reduce poverty among younger workers just entering the workforce.
  • Increased Credit Amounts: Increase the maximum credit amounts for childless workers and families with children to reflect the rising cost of living. This boost would allow more families to cover essential expenses such as housing, healthcare, and childcare.
  • Simplified Filing: Simplify the process for applying for the EITC by automatically enrolling eligible individuals through tax filing data, ensuring that more families can access this important benefit without the complexity of the current system.

A significant EITC expansion would help alleviate poverty, reduce income inequality, and give working-class families more financial breathing room. It would provide targeted relief to the most vulnerable communities, including single parents, young adults, and childless workers.

Corporate Tax Rate

In an equitable society, it is crucial that corporations contribute their fair share to the economy, ensuring that the burden of funding public services and infrastructure is shared appropriately. However, the approach to achieving this goal must be thoughtful and strategic, rather than reactionary.

Historically, raising the corporate tax rate has often been used as a tool to offset lost revenue caused by corporate tax loopholes. While increasing the tax rate can be a solution, it is not the only, nor necessarily the best, approach to ensuring that corporations pay their fair share. While I understand and can even envision myself supporting corporate tax hikes simply to achieve the effective rate I think is fair, I think that approach is unsustainable and adversely affects the businesses that are playing by the rules and don’t have the luxury the use loopholes to skirt their tax liability.

I believe that the focus should be on closing the loopholes and tax avoidance schemes that allow corporations to significantly reduce their tax liabilities. By tightening regulations and enforcing stricter compliance, we can ensure that corporations contribute fairly without constantly needing to raise the tax rate. That means:

  1. Fair Share Contribution: Corporations should pay their fair share of taxes, reflecting their role and benefits in our economy. This ensures that the costs of public services and infrastructure are not unfairly shouldered by individual taxpayers.
  2. Closing Loopholes: The primary focus should be on closing the loopholes that allow corporations to avoid paying their full tax obligations. This includes addressing practices such as profit shifting, offshore tax havens, and other aggressive tax avoidance strategies.
  3. Strategic Use of Tax Rates: While I support raising the corporate tax rate if necessary, it should not be the first or only tool used to ensure corporations pay their fair share. A perpetually increasing tax rate, without addressing the underlying issues of tax avoidance, can lead to diminishing returns and unintended economic consequences – including a lack of global competitiveness.
  4. Comprehensive Tax Reform: I advocate for a comprehensive approach to tax reform that balances the corporate tax rate with measures to close loopholes and improve enforcement. This ensures that all corporations, regardless of size or sector, are contributing fairly to the economy.
  5. Resisting Perpetual Rate Increases: Raising the corporate tax rate should be done judiciously and in response to genuine needs, not as a knee-jerk reaction to lost revenue. The ultimate goal is to achieve a fair and stable tax system where corporations pay what they owe, without the need for constant adjustments.

By focusing on closing loopholes and enforcing existing laws, we can create a more balanced and fair tax system that benefits everyone. Whether through adjusting the tax rate or closing loopholes, the objective remains the same: ensuring that corporations contribute their fair share to the prosperity of the surrounding communities and the nation as a whole.

Windfall Elimination Provision

I firmly believe that all Americans, especially those who have dedicated their careers to public service, deserve the full Social Security benefits they have rightfully earned. The windfall elimination provision (WEP) and the government pension offset (GPO) unfairly penalize retired federal, state, and local government employees, including police officers, firefighters, educators, and postal workers, by reducing their Social Security benefits. This is not only unjust but also a disservice to those who have committed their lives to serving our communities.

I wholeheartedly support the Social Security Fairness Act, introduced by Representatives Abigail Spanberger (D-VA) and this district’s current incumbent Garrett Graves (R-LA), that seeks to repeal these two controversial provisions. The bill has garnered significant bipartisan support, including formal endorsement from the House Problem Solvers Caucus and 320 cosponsors from both parties. This broad coalition underscores the urgency and importance of addressing this issue.

It is time to right this wrong and ensure that our public servants receive the Social Security benefits they have earned and deserve.

Making our Tax Code Make Sense

My policy position on reforming the tax code is founded on the principles of fairness and equity. It’s essential that we overhaul our current tax system to ensure that it serves the entire population justly, rather than favoring the wealthy few. A critical step in this direction is the removal of salary caps on taxes. It’s indefensible that individuals earning beyond a certain threshold contribute a smaller percentage of their income than those earning less. This policy aims to level the playing field by ensuring that all income is taxed in a fair and proportional manner.

Furthermore, closing tax loopholes is paramount. The existing tax code is riddled with exemptions and loopholes that disproportionately benefit the highest earners and large corporations. By eliminating these loopholes, we can ensure that the tax burden is distributed more equitably, preventing the wealthiest from exploiting the system to reduce their tax obligations.

Finally, it is imperative that the highest earners in our society are paying their fair share in federal income tax. This means not only adjusting the tax brackets to more accurately reflect the wealth distribution in our country but also ensuring that capital gains are taxed at a rate that reflects their impact on the economy.