By Taxpayer Association of Oregon
Despite Taxpayer Association opposition in committee testimony this week, the Senate Housing Committee passed out SB 852 to the Senate Finance Committee and it will cost many homeowners thousands — yes thousands — in higher tax bills. Sb 852 slashes the Oregon Mortgage Interest Deduction for many higher income homeowners.
SB 852 also creates a massive marriage penalty. Under the unamended bill, the policy considers individuals making $225,000 a year the same a a married couple with a family making the same amount jointly, or $112,000 each.
The bill also fails to address a CPI index based on inflation. With rapidly rising home prices, especially in the Portland Area, this tax will absorb more and more vulnerable middle class homeowners everyday it becomes law.
The bill also ambitiously eliminates the ability to take the mortgage interest deduction on a second home. These aren’t large family homes being rented in one or Oregon’s destination resorts, like the proponents would lead you to believe. The fact is, many home owners have to carry two mortgages while they transition from one home to another – downsizing with age, or upsizing to accommodate a growing family. This means we are taxing many financially vulnerable homeowners who have based life-size financial decisions on Oregon’s current tax only to have politicians yank out the rug they’re standing on with next to no warning.
Put simply, SB 852 is a mess.