On Wednesday, Senator Cory Booker (D-New Jersey) unveiled his plan to address affordable housing that would provide a tax credit for renters while ensuring they would not spend more than 30 percent of their income on rent.
According to Booker, his plan would reach 57-million Americans and the median credit for a benefiting family would equal $4,800. He stated the plan would lift 9.4 million Americans out of poverty.
The plan would cost an estimated $134 billion annually.
According to his post on the platform Medium:
A Renters Credit to help cap rental costs at 30 percent of income for working and middle-class Americans:
While over 43 million U.S. households rent their homes, there isn’t a single county in America where a full-time worker making the federal minimum wage can afford a two-bedroom apartment at fair-market rent. And the problem is only getting worse: almost half of all renters spend more than 30 percent of their income on rent; in 1960, it was 1 in 5. At the same time, homeownership is increasingly out of reach, with rates of ownership reaching historic lows in recent years. We spend $201 billion each year through the tax code subsidizing homeownership, overwhelmingly benefiting wealthy families.
This plan will provide a refundable renters tax credit that would offer relief for individuals and families who are working hard, but still struggling to cover rent at the end of the month. Anyone paying more than 30 percent of their before-tax income would be eligible for the credit, which would cover the difference between 30 percent of a beneficiary’s income and their rent (capped at the neighborhood fair market rent). According to researchers at Columbia University, the impact would be sweeping: the credit would benefit more than 57 million people, including nearly 17 million children, and lift 9.4 million Americans out of poverty. The median credit for a benefiting family would equal $4,800.
For Bookers full plan and Medium post, click here.