Earlier this week, the Democratic leadership attempted to bring legislation to the Senate floor purported to ease the nation’s ailing housing industry. The legislation includes a number of provisions to offer assistance to both homeowners and industry. Unfortunately, the proposal also included language to change fundamentally the current treatment of mortgages on principle residences under bankruptcy law. Such a change would have an adverse impact on both the availability and cost of mortgage financing as well as placing more stress on already strained securitization markets.



Absent from the so-called “Stimulus II” package is any recognition of the adverse impact that scheduled tax increases will have on American families. Senator Sam Brownback has released a study, “Making Tax Relief Permanent,” which discusses the $213 billion tax increase scheduled to hit American taxpayers to the tune of $1,833 EACH in 2011 alone. The increase will take place without even a single vote of either chamber of the Congress.



If scheduled increases are allowed to occur and there is no AMT relief, the tax burden will rise by at least 40% for married couples with two children and with incomes under $100,000 (by 261% for families with incomes of $50,000).



The study can also be downloaded from the JEC Senate Republican Website at:
https://www.jec.senate.gov/republicans/_files/MakingTaxReliefPermanent20080229.pdf




Jeffrey L. Schlagenhauf
Senate Republican Staff Director
Joint Economic Committee
805 Hart Senate Office Building
Washington, DC 20510
jeff_schlagenhauf@jec.senate.gov