NATIONAL LEGISLATIVE UPDATE
Update on Tax Increase Proposals from Ways and Means Committee Evan Liddiard National Association of REALTORS® Washington DC
House Ways and Means Committee Chairman Richard Neal (D-MA) released to the public the starting point documents that outline the tax increase provisions the Committee will consider in their markup session, which started today and will run through Wednesday. This is part of the congressional action to put into bill form the infrastructure legislation that was set up by the budget resolution that was passed by thin margins in both the House and Senate last month. That resolution allows for filibuster-proof legislation that spends up to $3.5 trillion (over ten years) on human infrastructure items, including health, education, climate change, and economic security. The Ways and Means Committee bears the brunt of finding ways to offset this spending in the House. The markup session has been widely anticipated as one of the final committee steps before the House Budget Committee packages all the different parts of the legislation into
one gargantuan bill that could come to the House floor for a vote toward the end of the month.
“While it is still too early to say that the real estate sector has dodged a bullet on these tax increases, the early signs are very good compared to what might have been included in the bill” NAR’s Advocacy Group has been watching for the details that might emerge as ways to pay for the enormous cost of this legislation. Earlier this year, the Biden White House put forward a number of suggested ways to offset the cost, and some of these, if enacted, could greatly harm the real estate sector and investment in real property. NAR has had hundreds of meetings with Members of Congress and sent many letters, alone and in conjunction with coalition partners, outlin-
ing our concerns with many of these tax increase ideas and the impact they could have on the already troubled commercial real estate sector. While there was a half dozen or so specific tax increase proposals on President Biden’s list of suggested offsets that would directly impact real estate investment, we identified three that were of the most concern to our members and their clients, as follows: Limitations on 1031 like-kind exchanges. • A doubling of the top rate on capital gains taxes for higher-income individuals. • A proposal to tax the unrealized gains of capital assets upon the death of owners with such assets above a certain threshold. Because of the dire results that could occur should these tax increase proposals be enacted, most of the focus of NAR’s lobbyists has been on educating Members of Congress on why these are bad ideas for our nation, its economy, afford-
NMAR REALTOR® Voice | Third Quarter 2021 | Page 6
