House Ways and Means Committee Chairman Rep. Dave Camp, R-Mich., the House tax writer, leaves the podium after a news conference on Capitol Hill in Washington, Wednesday, Feb. 26, 2014, where he outlined a major plan to rewrite the nation’s tax code.WASHINGTON – A sweeping House Republican plan to overhaul the nation’s tax laws would wipe out a slew of popular tax breaks to help pay for lower overall tax rates, a politically risky move in an election year that drew quick opposition Wednesday.
The plan would repeal deductions for state and local taxes, medical expenses and moving expenses. Tax credits for child care, adoption services and energy-efficient upgrades to homes would be gone.
The mortgage interest deduction would be reduced for people buying houses costing more than $500,000. The deduction for charitable giving would be limited to contributions that exceed 2 percent of a taxpayer’s income.
In exchange, income tax rates would be cut and the standard deduction, which is used by most taxpayers, would be nearly doubled. The child tax credit would be increased and a complicated series of tax breaks for education expenses would be consolidated and simplified.
The plan would mark the first overhaul of the tax code since 1986. It borrows ideas from President Barack Obama and other Democrats. But here’s a reality check: It has almost no chance of becoming law this year. Even House Speaker John Boehner, R-Ohio, distanced himself from the details Wednesday.