The proposed legislation aims to level the playing field for individual homeowners and small landlords by ensuring that large-scale property owners do not benefit from federal tax deductions that smaller property owners depend on. If enacted, these changes could encourage more equitable housing policies, potentially leading to lower rental prices and increased availability of affordable housing units. By restricting deductions, the bill seeks to limit the financial advantages of predatory investing practices within the housing sector.
Summary
House Bill 9937, titled 'Stop Predatory Investing Act', proposes significant amendments to the Internal Revenue Code concerning tax deductions for owners of multiple single-family residential rental properties. Specifically, the bill disallows interest and depreciation deductions for taxpayers who own 50 or more single-family properties. The bill is designed to target large-scale real estate investors and speculators who, per its proponents, contribute to the housing affordability crisis by purchasing large numbers of residential properties and driving up rental prices in local markets.
Contention
Notable points of contention surrounding HB 9937 include debates regarding the impact of these restrictions on the rental market. Critics argue that disallowing these tax deductions might discourage investment in residential rentals, resulting in reduced housing availability and potentially increased rents as landlords seek to compensate for higher operating costs. Supporters, however, maintain that the bill is a necessary step towards combating market monopolization by large investors and enhancing housing accessibility for everyday families.