The HOME Act, or Helping Our Middle-Income Earners Act, was introduced by Representatives Eshoo and Thompson to the House of Representatives on March 3, 2016. It is designed to amend the Internal Revenue Code of 1986 to allow for a deduction for HOA assessments. If you live in an HOA or similar community, you should know a little more about the HOME Act and how it can help you.
Summary of the Act
The HOME Act is designed to help middle-income families with their HOA assessments. Basically, the act covers homeowners in HOAs, condos, housing cooperatives and community associations. Homeowners who make $115,000 or less a year are allowed to deduct up to $5,000 of their association fees and assessments on their federal taxes.
Why the Act Was Proposed
The act was proposed to help create a balance for homeowners who live in neighborhoods with associations. These individuals pay their HOA assessments and fees, which is important to help run the community and keep it nice. Of course, they are also expected to pay property taxes. However, many homeowners who are part of an association don’t even use some municipal services from the municipality. They actually use them from their community association, which means they end up paying double for the services. The act will help homeowners recoup some of this money by allowing them to deduct some of their assessments from their taxes.
How It Will Help Homeowners and HOAs
This is a great idea to help both homeowners and HOAs. It allows homeowners to continue to pay their assessments and fees, so the community doesn’t suffer. However, the homeowners don’t have to suffer either. With increasing expenses, such as child care, college tuition, health care and mortgage, middle-income homeowners have a hard time paying for everything. The ability to deduct some assessments from taxes relieves some of this burden from homeowners without negatively affecting the community by reducing assessments.
Anyone who lives in an association and pays monthly assessments should be aware of the HOME act because it will help many middle-income families. If the act is passed, homeowners will be allowed to deduct some of their HOA assessments from their taxes, making it easier for them to make ends meet without hurting the community.