In Advance of Tax Day, Brown Announces Support for Bill That Would Expand, Make Permanent Property Tax Deduction for Non-Itemizing Homeowners
Current Property Tax Credit is Not Permanent Tax Credit—and Can Only Be Claimed by Homeowners Who Itemize Tax Returns; Ohio Homeowners Pay A Median of $1,805 in Property Taxes Each Year
WASHINGTON, D.C.—An estimated 1.5 million Ohio homeowners could see approximately $2.9 billion in property tax relief, thanks to a new bill supported by U.S. Sen. Sherrod Brown (D-OH). In advance of Tax Day, Brown announced his support for a new bill to allow Ohio homeowners—including those who do not itemize their federal tax return—to deduct the full cost of their state and local property taxes from their federal income tax return. The legislation, known as the Homeowner Tax Fairness Act, would provide additional tax relief for up to 30 million Americans, including approximately 1.5 million Ohioans—for a total federal tax deduction of more than $2.9 billion for Ohio homeowners.
“Middle-class families all across Ohio are struggling to pay their ever-rising property tax bills on top of their mortgage payments and home utility bills,” Brown said. “The good news is, we can provide property tax relief to Ohioans by allowing homeowners—even those that don’t itemize their federal income tax returns—to take the full deduction of their state and local property taxes. At a time when property tax valuations have often failed to keep pace with changing home values, allowing homeowners to deduct the full cost of their property taxes would help put more money back in pockets of Ohio families.”
Brown released estimates showing that more than 1.5 million Ohio homeowners would be able to take deductions totaling nearly $2.9 billion on their federal income tax returns under the new bill. In Cuyahoga County, for example, more than 165,000 homeowners would be able to deduct nearly $410 million from their federal tax returns. More than 129,000 Ohio homeowners in Franklin County could deduct nearly $314 million from their returns, and more than 101,000 Hamilton County homeowners would be able to deduct nearly $215 million.
Brown’s estimates are based on data collected by the U.S. Census and the IRS showing that approximately 49.1 percent of Ohioans who pay property taxes do not itemize their deductions. Information on the total number of homeowners by county in Ohio was collected from the U.S. Census’ 2005-2009 American Community Survey 5-Year Estimates, figures that were then multiplied against the 49.1 percent figure provided by the U.S. Census and the IRS. County-by-county information on median property taxes paid by homeowners in Ohio was gathered from the Tax Foundation. Ohio homeowners paid a median $1,805 in property taxes between 2005 and 2009.
Prior to 2008, only homeowners that itemized their tax deductions could claim deductions for state and local property taxes. A temporary measure, passed in 2008, allowed non-itemizing homeowners to deduct their property taxes, but capped the deduction at only $500 per individual and $1,000 per family. The Homeowner Tax Fairness Act would allow all filers to deduct the full amount of their property taxes and would make this property tax relief permanent.