Proposed Federal Bill Could Benefit Local Property Taxpayers

Hudson Valley homeowners who do not itemize their taxes could save more than $38.7 million if they were allowed to deduct property taxes.

Sen. Kirsten Gillibrand, D-NY, announced Tuesday she will introduce legislation to do just that in the first bill she will submit in the 112th Congress.

"This is an idea I've been working on through my time in Congress to make sure we can lower the burden of property taxes," Gillibrand said during a press conference call.

Gillibrand said only homeowners who currently itemize their taxes see the benefit of deducting the amount paid in property taxes.

"My legislation will make the deduction available" for everyone, she said. "There are a lot of families for whom this will really make a difference."

Prior to 2008, only taxpayers who itemized could claim a deduction for state and local property taxes. During the housing crisis in 2008, Congress temporarily allowed non-itemizing taxpayers the benefit of deducting up to $500. That expired at the end of 2009.

Gillibrand said her bill would let everyone file the full amount paid in property taxes and would make the benefit permanent.

Approximately 1.1 million New Yorkers would be able to take advantage of the change in the law, saving homeowners about $1 billion. In the lower Hudson Valley, more than 17,000 people could see savings amounting to more than $38.7 million.

Gillibrand said this bill is not a Democratic idea or a Republican one.

This legislation "will bring bipartisan support because it is just a good idea," she said.

Here's a chart showing the estimated savings per county if Gillibrand's bill is passed: