On February 8, Representative Alan Grayson (D-FL) introduced the “Renters Fairness and Equality Act,” H.R. 4494, to allow tax filers to deduct from their incomes the rent they paid or accrued on their principal residence during the taxable year.
Currently, the federal tax code provides no housing-related tax breaks for taxpayers who are renters. In contrast, there are multiple tax breaks that benefit homeowners, including the mortgage interest deduction and the deduction for state and local property taxes.
The bill limits who may benefit from the deduction. Renters would be unable to claim the deduction if their principal residence had an assessed or appraised value of over $1 million for the taxable year or $500,000 in the case of a married individual filing a separate return. Additionally, the bill would prohibit tax filers from being able to deduct rent they paid on their principal residence if they could also claim the mortgage interest deduction or the state and local property tax deduction on the same property.
If enacted, H.R. 4494 would permit tax filers to deduct rent they paid beginning in 2015.
The bill currently has no cosponsors and has been referred to the House Committee on Ways and Means.
Read the text of the bill here: https://www.congress.gov/114/bills/hr4494/BILLS-114hr4494ih.pdf