WASHINGTON, D.C. – U.S. House Assistant Democratic Leader James E. Clyburn (SC) today released a Democratic Staff Report on the specific effects of the new Republican tax law on homeowners in South Carolina.
According to today’s report compiled by the Democratic staff of the House Oversight and Government Reform Committee, “the new tax law imposes significant new financial penalties on American homeowners across the country, while essentially using the funds raised by these tax increases to help pay for lucrative new tax breaks for real estate developers.”
According to the report:
- None of the approximately 1,258,700 homeowners currently living in South Carolina will be allowed to claim deductions for interest on home equity loans they used for any purposes other than home improvement.
- Beginning in 2018, about 146,000 homeowners in South Carolina with existing home equity loans will not be allowed to claim full home equity interest deductions as they did in the past.
- Although 514,500 homeowners in South Carolina used to be able to deduct their full property taxes, about 116,800 no longer will be allowed to do so.
“The fact of the matter is the Republican tax bill is a massive windfall for the wealthiest few at the expense of working people,” Clyburn stated. “This new report clearly shows the Republican tax law is really a tax scam. It will harm many homeowners in South Carolina and make our affordable housing crisis exponentially worse.”
“Under the new tax law, homeowners are now prohibited from deducting interest on home equity loans if they use those funds for unexpected medical emergencies, to pay for college education, or for any purpose other than home improvement,” the report states. Meanwhile, “real estate developers are now allowed to take new deductions on pass-through income, pay dividends that are taxed at reduced rates, take advantage of an exemption from a provision that otherwise limits businesses from deducting interest, and utilize another exemption to avoid paying taxes on property exchanges.”
“President Trump and Republicans in Congress made a clear choice last year when they enacted their tax bill,” the report concludes. “They chose to take away longstanding tax deductions that American families have relied on for decades while at the same time creating new tax breaks on real estate developers. Although some may reap large financial windfalls as a result of the changes in the new tax law, many American families will be penalized despite their ongoing efforts to faithfully invest in their single biggest asset—their home.”