The newly approved overhaul of the federal tax code could raise federal income taxes for at least 1,780 New Haven homeowners, according to the city.
The U.S. Senate approved the tax bill Friday, after the House of Representatives did the same on Thursday. President Trump is expected to sign it.
The bill will no longer allow people to deduct from their federal taxes any local property taxes and state income taxes they pay above $10,000.
Most people in New Haven pay under $10,000 a year in property taxes. But 1,780 owners of residential properties of four units or less pay that much or more, according to city mayoral spokesman Laurence Grotheer.
Almost all of them — 90 percent — live in East Rock/Prospect Hill, Wooster Square and the Westville flats. Those 90 percent live in Wards 7, 8, 9, 10, 19, 21, and 25.
Those properties have market values of $369,330 or more, leading to the $10,000-plus tax bills based on the current mill rate of 38.68. (Tax bills are based on assessed values of properties, which are 70 percent of market values.)
Other New Haveners may be affected by the new federal law as well if the total of local property taxes and state income taxes exceeds $10,000.
But the change affects only those filers who itemize deductions on their federal tax forms.
Republicans argue that the new law will reduce most people’s taxes. Democrats argue that it will overwhelmingly benefit the ultra-wealthy at the expense of adding $1.5 trillion to the national debt and forcing deep cuts in needed government services. Republicans argue that new investment spurred by the cuts will prevent that new deficit from materializing; Democrats argue that both independent analyses of the bill and the record from past tax cuts show that such massive new investment will not follow.
New Haven U.S. Rep. Rosa DeLauro decried Friday’s House vote as part of a “massive assault of the social safety net” that Republican Speaker House Ryan plans to continue by “going after social security, Medicare Medicaid.” (Watch her comments in the video at the top of the story, from an interview with Steve Hamm.)
Click here to read a CT Mirror story about other Connecticut Congress members’ reactions to the bill.