Tax Credits, Deductions and Exemptions

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      What to Know About Herschel Walker’s Residency Status in Georgia

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      The Republican Senate candidate listed his Atlanta residence on public records as a rental property in 2021, while receiving a homestead exemption in Texas.Herschel Walker, the Republican candidate in Georgia’s Senate runoff, revealed in a financial disclosure statement that his Atlanta residence was being used as a rental property as recently as 2021. Tax and assessment records in Fulton County, Ga., listed Mr. Walker’s wife, Julie Blanchard, as the sole owner of the 1.5-acre property in northwest Atlanta, further undermining the candidate’s narrative about his Georgia residency in the fiercely contested Dec. 6 runoff against Senator Raphael Warnock, a Democrat.On a financial disclosure form required by the Senate for incumbents and candidates, Mr. Walker reported in May that the “Georgia residence” had generated between $15,001 and $50,000 in rental income in 2021 for his spouse. The revelations were reported earlier by The Daily Beast.Here is what to know about the questions surrounding where Mr. Walker lives:Does a candidate have to live in the state they are running to represent? No, though the Constitution requires senators to reside in the state they represent after they are elected.The details about the property in Georgia emerged one week after media reports that Mr. Walker received a tax exemption on his Texas home that is meant for primary residents of the state. Georgia Senate Runoff: What to KnowCard 1 of 6Another runoff in Georgia. More

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      Herschel Walker, Running in Georgia, Receives Tax Break for Texas Residents

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      Mr. Walker, Georgia’s Republican nominee for Senate, is benefiting from a homestead exemption meant for primary residents of Texas.ATLANTA — Herschel Walker, the Republican candidate for Senate in Georgia, is receiving a tax exemption on his Texas home that is meant for primary residents of the state, despite currently living and running for office in Georgia.Public tax records first reported by CNN show that this year Mr. Walker will receive a homestead tax exemption of roughly $1,500 for his home in the Dallas area, which he listed as his primary residence. He has received the tax relief for his home since 2012, according to an official in the tax appraisal office of Tarrant County, where Mr. Walker’s home is located.Under the Constitution, Senate candidates are required to reside in the state they will represent only once they are elected. In Georgia, candidates must meet a handful of stipulations to establish residency in the state before filing their bids for office. Mr. Walker’s tax exemption in Texas suggests that his primary residence remains outside Georgia.A spokesman for Mr. Walker’s campaign did not respond to a request for comment.According to the Texas comptroller, Mr. Walker’s use of the tax exemption while running in Georgia is legal. The comptroller’s website states that you may still receive the tax break after moving away from home temporarily, if “you do not establish a principal residence elsewhere, you intend to return to the home, and you are away less than two years.”Mr. Walker, who grew up in Georgia and was a phenom for the University of Georgia football team, has made his roots a centerpiece of his campaign. His decisive primary victory in May and support from Republican voters were driven in large part by his stardom in the state. He will face Senator Raphael Warnock, a Democrat, in a runoff election on Dec. 6, after neither candidate cleared the 50 percent threshold needed to win in Georgia on Nov. 8.This is not the first time Mr. Walker has faced questions about his residency. Before announcing his Senate campaign in 2021, Mr. Walker lived in Texas for more than two decades. He registered to vote in Georgia in August 2021, days before he declared his candidacy.Andra Gillespie, an associate professor of political science at Emory University, said that Mr. Walker’s tax exemption was unlikely to endanger his qualification for office or turn off the Republicans who supported him in the general election. But she added that in the final weeks of his runoff campaign against Mr. Warnock, the information could add more fodder to Democrats’ argument that Mr. Walker moved back to the state solely for his political career.“Herschel Walker was never making the claim that he was a recent resident of Georgia — he was a native-son candidate,” she said. “If the Democrats can mobilize some additional people based on these allegations, then they will use it that way.”Alyce McFadden More

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      Democrats Spent $2 Trillion to Save the Economy. They Don’t Want to Talk About It.

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      Polls show voters liked direct payments from President Biden’s 2021 economic rescue bill. But they have become fodder for Republican inflation attacks.In the midst of a critical runoff campaign that would determine control of the Senate, the Rev. Raphael Warnock promised Georgia voters that, if elected, he would help President-elect Biden send checks to people digging out of the pandemic recession.Mr. Warnock won. Democrats delivered payments of up to $1,400 per person.But this year, as Mr. Warnock is locked in a tight re-election campaign, he barely talks about those checks.Democratic candidates in competitive Senate races this fall have spent little time on the trail or the airwaves touting the centerpiece provisions of their party’s $1.9 trillion economic rescue package, which party leaders had hoped would help stave off losses in the House and Senate in midterm elections. In part, that is because the rescue plan has become fodder for Republicans to attack Democrats over rapidly rising prices, accusing them of overstimulating the economy with too much cash.The economic aid, which was intended to help keep families afloat amid the pandemic, included two centerpiece components for households: the direct checks of up to $1,400 for lower- to middle-class individuals and an expanded child tax credit, worth up to $300 per child per month. It was initially seen as Mr. Biden’s signature economic policy achievement, in part because the tax credit dramatically reduced child poverty last year. Polls suggested Americans knew they had received money and why — giving Democrats hope they would be rewarded politically.Liberal activists are particularly troubled that Democratic candidates are not focusing more on the payments to families.“It’s a missed opportunity and a strategic mistake,” said Chris Hughes, a founder of Facebook and a senior fellow at the Institute on Race, Power, and Political Economy at The New School, who is a co-founder of the liberal policy group Economic Security Project Action. “Our public polling and our experience suggest the child tax credit is a sleeper issue that could influence the election, a lot more than a lot of candidates realized.”Celinda Lake, a Democratic pollster who has surveyed voters in detail on the child credit, said data suggest the party’s candidates should be selling Americans on the pieces of Mr. Biden’s policies that helped families cope with rising costs.“We have a narrative on inflation,” Ms. Lake said in an interview. “We just aren’t using it.”Many campaign strategists disagree. They say voters are not responding to messages about pandemic aid. Some Democrats worry that voters have been swayed by the persistent Republican argument that the aid was the driving factor behind rapidly rising prices of food, rent and other daily staples.Economists generally agree that the stimulus spending contributed to accelerating inflation, though they disagree on how much. Biden administration officials and Democratic candidates reject that characterization. When pressed, they defend their emergency spending, saying it has put the United States on stronger footing than other wealthy nations at a time of rapid global inflation.Republicans have spent nearly $150 million on inflation-themed television ads across the country this election cycle, according to data from AdImpact. The State of the 2022 Midterm ElectionsWith the primaries over, both parties are shifting their focus to the general election on Nov. 8.The Final Stretch: With less than one month until Election Day, Republicans remain favored to take over the House, but momentum in the pitched battle for the Senate has seesawed back and forth.A Surprising Battleground: New York has emerged from a haywire redistricting cycle as perhaps the most consequential congressional battleground in the country. For Democrats, the uncertainty is particularly jarring.Arizona’s Governor’s Race: Democrats are openly expressing their alarm that Katie Hobbs, the party’s nominee for governor in the state, is fumbling a chance to defeat Kari Lake in one of the most closely watched races.Herschel Walker: The Republican Senate nominee in Georgia reportedly paid for an ex-girlfriend’s abortion, but members of his party have learned to tolerate his behavior.In Georgia alone, outside groups have hammered Mr. Warnock with more than $7 million in attack ads mentioning inflation. “Senator Warnock helped fuel the inflation squeeze, voting for nearly $2 trillion in reckless spending,” the group One Nation, which is aligned with Senator Mitch McConnell of Kentucky, the Republican leader, says in an ad that aired in the state in August.Democrats have tried to deflect blame, portraying inflation as the product of global forces like crimped supply chains while touting their efforts to lower the cost of electricity and prescription drugs. They have aired nearly $50 million of their own ads mentioning inflation, often pinning it on corporate profit gouging. “What if I told you shipping container companies have been making record profits while prices have been skyrocketing on you?” Mr. Warnock said in an ad aired earlier this year.Candidates and independent groups that support the stimulus payments have spent just $7 million nationwide on advertisements mentioning the direct checks, the child tax credit or the rescue plan overall, according to data from AdImpact.Far more money has been spent by Democrats on other issues, including $27 million on ads mentioning infrastructure, which was another early economic win for Mr. Biden, and $95 million on ads that mention abortion rights..css-1v2n82w{max-width:600px;width:calc(100% – 40px);margin-top:20px;margin-bottom:25px;height:auto;margin-left:auto;margin-right:auto;font-family:nyt-franklin;color:var(–color-content-secondary,#363636);}@media only screen and (max-width:480px){.css-1v2n82w{margin-left:20px;margin-right:20px;}}@media only screen and (min-width:1024px){.css-1v2n82w{width:600px;}}.css-161d8zr{width:40px;margin-bottom:18px;text-align:left;margin-left:0;color:var(–color-content-primary,#121212);border:1px solid var(–color-content-primary,#121212);}@media only screen and (max-width:480px){.css-161d8zr{width:30px;margin-bottom:15px;}}.css-tjtq43{line-height:25px;}@media only screen and (max-width:480px){.css-tjtq43{line-height:24px;}}.css-x1k33h{font-family:nyt-cheltenham;font-size:19px;font-weight:700;line-height:25px;}.css-ok2gjs{font-size:17px;font-weight:300;line-height:25px;}.css-ok2gjs a{font-weight:500;color:var(–color-content-secondary,#363636);}.css-1c013uz{margin-top:18px;margin-bottom:22px;}@media only screen and (max-width:480px){.css-1c013uz{font-size:14px;margin-top:15px;margin-bottom:20px;}}.css-1c013uz a{color:var(–color-signal-editorial,#326891);-webkit-text-decoration:underline;text-decoration:underline;font-weight:500;font-size:16px;}@media only screen and (max-width:480px){.css-1c013uz a{font-size:13px;}}.css-1c013uz a:hover{-webkit-text-decoration:none;text-decoration:none;}How Times reporters cover politics. We rely on our journalists to be independent observers. So while Times staff members may vote, they are not allowed to endorse or campaign for candidates or political causes. This includes participating in marches or rallies in support of a movement or giving money to, or raising money for, any political candidate or election cause.Learn more about our process.Mr. Warnock has not cited any of the rescue plan’s provisions in his advertisements, focusing instead on issues like personal character, health care and bipartisanship, according to AdImpact data.Senator Raphael Warnock, who is locked in a tight re-election campaign this year, barely mentions the relief checks.Nicole Craine for The New York TimesFor months after the rescue plan’s passage, Democratic leaders were confident that they had solved an economic policy dilemma that has vexed Democrats and Republicans stretching back to the George W. Bush administration: They were giving Americans money, but voters weren’t giving them any credit.Tax cuts and direct spending aid approved by Mr. Bush, President Barack Obama and President Donald J. Trump failed to win over large swaths of voters and spare incumbent parties from large midterm losses. Economists and strategists concluded that was often because Americans had not noticed they had benefited from the policies each president was sure would sway elections.That was not the case with the direct checks and the child tax credit. People noticed them. But they still have not turned into political selling points at a time of rapid inflation.As the November elections approach, most voters appear to be motivated by a long list of other issues, including abortion, crime and a range of economic concerns.Mr. Warnock’s speech last week to a group of Democrats in an unfinished floor of an office space in Dunwoody, a northern Atlanta suburb, underscored that shift in emphasis.He began the policy section of the rally with a quick nod to the child credit, then ticked through a series of provisions from bills that Mr. Biden has signed in the last two years: highways and broadband internet tied to a bipartisan infrastructure law, semiconductor plants spurred by a China competitiveness law, a gun safety law and aid for veterans exposed to toxic burn pits. He lingered on one piece of Mr. Biden’s Inflation Reduction Act: a cap on the cost of insulin for Medicare patients, which Mr. Warnock cast as critical for diabetics in Georgia, particularly in Black communities.The direct payments never came up.When asked by a reporter why he was not campaigning on an issue that had been so central to his election and whether he thought the payments had contributed to inflation, Mr. Warnock deflected.“We in Georgia found ourselves trying to claw back from a historic pandemic, the likes of which we haven’t seen in our lifetime, which created an economic shutdown,” he said. “And now, seeing the economy open up, we’ve experienced major supply chain issues, which have contributed to rising costs.”Direct pandemic payments were begun under Mr. Trump and continued under Mr. Biden, with no serious talk of another round after the ones delivered in the rescue plan. Most Democrats had hoped the one-year, $100 billion child credit in the rescue plan would be made permanent in a new piece of legislation.But the credit expired, largely because Senator Joe Manchin III, Democrat of West Virginia and a key swing vote, opposed its inclusion in what would become the Inflation Reduction Act, citing concerns the additional money would exacerbate inflation.Senator Michael Bennet, Democrat of Colorado, was one of the Senate’s most vocal cheerleaders for that credit and an architect of the version included in the rescue plan. His campaign has aired Spanish-language radio ads on the credit in his re-election campaign, targeting a group his team says is particularly favorable toward it, but no television ads. In an interview last week outside a Denver coffee shop, Mr. Bennet conceded the expiration of the credit has sapped some of its political punch.“It certainly came up when it was here, and it certainly came up when it went away,” he said. “But it’s been some months since that was true. I think, obviously, we’d love to have that right now. Families were getting an average of 450 bucks a month. That would have defrayed a lot of inflation that they’re having to deal with.”Mr. Biden’s advisers say the rescue plan and its components aren’t being deployed on the trail because other issues have overwhelmed them — from Mr. Biden’s long list of economic bills signed into law as well as the Supreme Court decision overturning Roe v. Wade that has galvanized the Democratic base. They acknowledge the political and economic challenge posed by rapid inflation, but say Democratic candidates are doing well to focus on direct responses to it, like the efforts to reduce costs of insulin and other prescription drugs.Ms. Lake, the Democratic pollster, said talking more about the child credit could help re-energize Democratic voters for the midterms. Mr. Warnock’s speech in Dunwoody — an admittedly small sample — suggested otherwise.Mr. Warnock drew cheers from the audience after he called the child tax credit “the single largest tax cut for middle- and working-class families in American history.”But his biggest ovation, by far, came when the economics section of his speech had ended, and Mr. Warnock had moved on to defending abortion rights. More

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      Fact-Checking a GOP Attack Ad That Blames a Democrat for Inflation

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      In a Nevada tossup race that could help decide whether Republicans gain control of the House, a super PAC aligned with congressional G.O.P. leaders recently mounted an economically driven attack against Representative Dina Titus.In a 30-second ad released on Saturday, the Congressional Leadership Fund accused Ms. Titus, a Democrat who represents Las Vegas, of supporting runaway spending that has exacerbated inflation.Here’s a fact check.WHAT WAS SAID“Economists said excessive spending would lead to inflation, but she didn’t listen. Titus recklessly spent trillions of taxpayer dollars,” the ad’s narrator says, and, later: “Now we’re paying the price. Higher prices on everything. Economy in recession. Dina Titus. She spent big … and we got burned.”This lacks context. The implication here is that Democrats’ policies led to inflation. We recently put this question to our economics correspondent, Ben Casselman, who said: “True, although we can argue all day about how much.”He explains: “Here’s what I think we can say with confidence: Inflation soared last year, primarily for a bunch of pandemic-related reasons — snarled supply chains, shifts in consumer demand — but also at least in part because of all the stimulus money that we poured into the economy. Then, just when most forecasters expected inflation to start falling, it took off again because of the jump in oil prices tied to the war in Ukraine.The State of the 2022 Midterm ElectionsWith the primaries over, both parties are shifting their focus to the general election on Nov. 8.A Focus on Crime: In the final phase of the midterm campaign, Republicans are stepping up their attacks about crime rates, but Democrats are pushing back.Pennsylvania Governor’s Race: Doug Mastriano, the Trump-backed G.O.P. nominee, is being heavily outspent and trails badly in polling. National Republicans are showing little desire to help him.Megastate G.O.P. Rivalry: Against the backdrop of their re-election bids, Gov. Greg Abbott of Texas and Gov. Ron DeSantis of Florida are locked in an increasingly high-stakes contest of one-upmanship.Rushing to Raise Money: Senate Republican nominees are taking precious time from the campaign trail to gather cash from lobbyists in Washington — and close their fund-raising gap with Democratic rivals.“Now, inflation is falling again. Overall consumer prices were up just 0.1 percent in August, and a separate measure showed prices falling in July. But a lot of that is because of the recent drop in gas prices, which we all know could reverse at any time. So-called core inflation, which sets aside volatile food and energy prices, actually accelerated in August.“All of which means we don’t know how long the recent pause in inflation will last, and we definitely don’t know whether Biden will get credit for it if it does.”Backing up a bit, it’s worth noting that not all of the stimulus spending was at the direction of President Biden and Democrats. The first two rounds were approved during the Trump administration. And, economists were not united in warning about inflation.As for the economy being in recession? “Most economists still don’t think the United States meets the formal definition,” Mr. Casselman wrote in July, and he said that remained true as we head into October. But such calls are only made in retrospect. “Even if we are already in a recession, we might not know it — or, at least, might not have official confirmation of it — until next year,” Mr. Casselman said.What was said“Tax breaks for luxury electric cars.”This is true. The Inflation Reduction Act contains a tax credit for electric vehicles. Their final assembly must be completed in North America to be eligible for the credit, which, indeed, extends to several luxury automakers. The list includes Audi, BMW, Lincoln and Mercedes, but also non-luxury models like the Ford Escape and Nissan Leaf. What about Tesla? It made the list of 2022 models, but it has already reached a federal cap of the number of vehicles eligible for the credit, according to the Energy Department.What was said“Even a billion dollars to prisoners, including the Boston Bomber.”This is exaggerated. Dzhokhar Tsarnaev, who was convicted of helping carry out the 2013 Boston Marathon bombings, received a $1,400 Covid-19 stimulus rebate from the federal government in June 2021. The money was part of the American Rescue Plan Act, which President Biden signed into law after it passed the House on a mostly party-line vote, with Ms. Titus supporting it.But what the Republican attack ad failed to disclose was that Mr. Tsarnaev was required by a federal judge to return the money as part of restitution payments to his victims. Another glaring omission was the fact that inmates were previously eligible for Covid-19 relief payments when former President Donald J. Trump was in office, though the Internal Revenue Service and some Republicans had later tried to rescind the payments. A federal judge thwarted those efforts, ruling that inmates could keep the payments.Those nuances haven’t stopped Republicans from latching onto the issue of inmates receiving Covid-19 payments against Democrats in key races across the nation, including Senator Raphael Warnock of Georgia and Senator Mark Kelly of Arizona. More

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      How Paul LePage, Running to Lead Maine, Benefited From Florida Tax Breaks

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      Mr. LePage, a former governor who is seeking to reclaim the office, has along with his wife benefited from property tax breaks reserved for permanent Florida residents, public records show.As governor of Maine for two terms until 2019, Paul LePage, a Republican, gained a reputation as one of the pre-Trump era’s most unfiltered politicians.He said he wanted to tell President Barack Obama to “go to hell,” and told the N.A.A.C.P. to “kiss my butt.” He made racist comments about drug dealers who supposedly travel to Maine and “impregnate a young white girl before they leave.”Making a comeback attempt now against his successor, Gov. Janet Mills, a Democrat, Mr. LePage is focusing heavily in his campaign on a push to phase out Maine’s income tax. He argues that the change is needed to keep wealthy residents from moving to Florida for just long enough each year to take advantage of the Sunshine State’s tax breaks.But Mr. LePage and his wife, Ann LePage, who have owned property in Florida for over a decade, have themselves benefited from that state’s tax laws while living in the Maine governor’s mansion, and again as he campaigns to return to the job. From 2009 to 2015, and also from 2018 through the end of this year, the couple received property tax breaks reserved for permanent Florida residents, public records show.The properties in question, both in Ormond Beach, Fla., are a home that the LePages bought in 2008 and sold in 2017, and another that they purchased in 2018 and still own. For both homes, the couple have sought and received what is called a homestead exemption, which is meant to apply only to primary residences in Florida.The sum the couple saved over the years is relatively small: A little over $8,500, according to a New York Times analysis of public records.But this is not the first time the LePages have faced scrutiny over such a tax matter — in 2010, Florida officials fined Mrs. LePage $1,400 before rescinding the penalty — and Mr. LePage’s focus on taxes in the current campaign for governor could open him up to attacks from Democrats.Mr. LePage’s campaign defended the tax moves, saying that Mrs. LePage’s mother had used the Florida home as her primary residence from 2009 until her death in 2015, when the couple removed the first homestead exemption. Mrs. LePage’s mother had scleroderma, a chronic disease that causes hardening of the skin.“Mrs. LePage’s mother would visit Augusta, but due to her condition, she spent a large amount of time, especially in cooler fall, winter and spring periods, at that permanent residence” in Florida, said Brent Littlefield, a spokesman for Mr. LePage’s campaign. “Mrs. LePage also traveled there in winter months to care for her. Her mother kept that as her primary residence while she was alive.”The campaign did not comment on the second exemption held from 2018 through this year. Attempts to reach Mrs. LePage directly were unsuccessful.The State of the 2022 Midterm ElectionsWith the primaries over, both parties are shifting their focus to the general election on Nov. 8.Inflation Concerns Persist: In the six-month primary season that has just ended, several issues have risen and fallen, but nothing has dislodged inflation and the economy from the top of voters’ minds.Herschel Walker: The Republican Senate candidate in Georgia claimed his business donated 15 percent of its profits to charities. Three of the four groups named as recipients say they didn’t receive money.North Carolina Senate Race: Are Democrats about to get their hearts broken again? The contest between Cheri Beasley, a Democrat, and her G.O.P. opponent, Representative Ted Budd, seems close enough to raise their hopes.Echoing Trump: Six G.O.P. nominees for governor and the Senate in critical midterm states, all backed by former President Donald J. Trump, would not commit to accepting this year’s election results.At campaign events, Mr. LePage has spoken about the couple’s home in Florida, and has criticized a Maine law requiring residents who split their time between the two states — so-called snowbirds — to spend at least 183 days, or just over half a year, in Florida in order to pay the state’s lighter tax burden.“We go down to Naples, Fla., to raise money from Mainers because that’s where all the money is — and it’s unfortunate that they have to leave for six months and a day,” Mr. LePage said in Bangor last month. “I have no problem going to Florida. We go to Florida, we have a home in Florida, but it’s for January and February, not for six months and a day. It’s unfortunate that we have this crazy tax and this is what happens.”But while Mr. LePage said that he and his wife were in Florida for only a couple of months a year, they have painted a different picture for Florida’s tax collectors over the years.In his final months as governor, Mr. LePage told reporters in November 2018 that he had a home in Florida and planned to move there because the state had no income tax. But by that time, records show, he and his wife had already claimed a homestead exemption on their Ormond Beach property — indicating that Florida had been the primary residence of Maine’s governor and first lady since March 2018, when they bought the home.That assertion meant that the four-bedroom home, about 15 minutes from the Atlantic Ocean, was eligible for a Florida homestead exemption, which shaves $50,000 from the taxable value of qualified primary residences in the state.After leaving office in 2019 because of Maine’s prohibition on serving a third consecutive term, Mr. LePage obtained a Florida driver’s license and registered to vote in the state. Then, in February 2020, he said he was considering a bid for a third term, and when he announced his run last year he cited criticisms of Ms. Mills’s response to the pandemic. He switched his voter registration back to Maine in 2020 and publicized pictures of himself putting Maine license plates back on his car.The couple have rented a home in Edgecomb, Maine, since 2020, and Mr. LePage has been campaigning in the state for much of the past year. But it was not until this June that Ann LePage informed a property appraiser in Florida that she and her husband were no longer residents of that state, according to the county appraiser’s office. The tax break will stay in effect through the end of this year, according to an official in the appraiser’s office in Flagler County, Fla., which handled the matter.Jon Alper, a Florida lawyer who specializes in asset protection, said the circumstances of the LePages’ homestead exemption claims were “certainly atypical.”“It’s possible under the law, but usually if one spouse is in the house, they’re both in the house,” he said.Mr. LePage and his wife, Ann, in 2014. They have owned two homes in Florida, one bought in 2008 and sold in 2017, and another that they purchased in 2018 and still own.Robert F. Bukaty/Associated PressThe LePages have struggled with tax issues while toggling between the two states for more than a decade.In 2008, while Mr. LePage was mayor of Waterville, Maine, his wife bought a home in Ormond Beach, not far from the home they would buy a decade later in the same city. She claimed the Florida homestead exemption even though she was also claiming a homestead exemption on a house she owned in Waterville. Both states require homeowners to certify that a property is their main residence in order to qualify for the exemption.That misstep was reported in 2010, during Mr. LePage’s first campaign for governor. Florida tax officials originally fined Mrs. LePage $1,400 for misleading them about her residency status in the state, but they withdrew the penalty shortly after, citing an explanation from Mrs. LePage that her mother, Rita DeRosby, was living in the house. A seldom-used provision in the Florida tax code allows homeowners to claim a homestead exemption if a dependent is residing on the property.Months after Mrs. LePage was cleared of wrongdoing, Ms. DeRosby joined the family’s move into the Maine governor’s mansion, according to local reports. When Ms. DeRosby died in 2015, her obituary said that she had “spent the last eight years of her life residing” with her daughter and Mr. LePage.Mr. LePage’s campaign proposal to eliminate Maine’s state income tax has prompted criticism from some Democratic officials that local governments would be forced to raise property taxes to offset costs.While he was governor, Mr. LePage tried to eliminate Maine’s homestead exemption, a proposal that would have denied an estimated 213,000 Mainers benefits similar to those he enjoyed in Florida, according to an analysis by the left-leaning Maine Center for Economic Policy. More

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      SALT Deduction That Benefits the Rich Divides Democrats

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      House Democrats are poised to lift a cap on the state and local tax deduction, a gift to wealthy homeowners in some blue states.WASHINGTON — A plan by House Democrats to reduce taxes for high earners in states like New Jersey, New York and California in their $1.85 trillion social policy spending package is becoming an early political albatross for the party, with Republicans already mobilizing to accuse Democrats of defying their populist principles in favor of cutting taxes for the rich.The criticism offers a preview of the emerging battle lines ahead of next year’s midterm elections and underscores the challenge that Democrats face when local politics collide with the party’s national ambitions to promote economic equity. For Republicans who have defended their 2017 tax cuts, which overwhelmingly benefited the wealthy, the proposal by Democrats to raise the limit on the state and local tax deduction is an opportunity to flip the script and cast Democrats as the party of plutocrats.“I think they’re struggling to maintain their professed support for taxing the wealthy, yet they are providing a huge tax windfall under the SALT cap,” said Representative Kevin Brady of Texas, the top Republican on the House Ways and Means Committee, referring to the acronym for state and local taxes. “If your priorities are working families, make that the priority, not the wealthy.”Republicans, looking for ways to finance their own tax cuts in 2017, capped the amount of state and local taxes that households could deduct from their federal tax bills at $10,000. Democrats from high-tax states like New York, New Jersey and California have spent years promising to repeal the cap and are poised to lift it to $80,000 through 2030, before reducing it back to $10,000 in 2031. The cap, which is currently set to disappear in 2025, would then expire permanently in 2032.The bill would cut taxes sharply for the next five years by increasing the value of the deduction, but it would mean higher taxes in the following five years than if the cap were allowed to expire. The Congressional Budget Office said on Thursday that over the course of a decade, the changes to the deduction would amount to a tax increase that would raise about $14.8 billion in revenue.The House proposal is likely to change in the Senate, where it has its own champions and detractors. Senator Chuck Schumer, Democrat of New York and the majority leader, has embraced a more generous deduction while Senator Bernie Sanders, the Vermont independent who is the chairman of the Senate Budget Committee, has sharply criticized the House proposal. He joined Senator Bob Menendez, Democrat of New Jersey, in negotiating an income cap — as high as $550,000, though that number is in flux — on who can receive the deduction.This week, the National Republican Congressional Committee released survey data that it said suggested most voters in battleground states would be less likely to vote for Democrats who supported a policy that gave tax cuts to rich homeowners in New Jersey, New York and California. It said that the Democratic Party would have “to defend its politically toxic policies which penalize hard working families to reward liberal elites.”Prominent tax and budget analysts have argued that expanding the deduction amounted to an unnecessary giveaway to the rich.According to the nonpartisan Committee for a Responsible Federal Budget, a family of four in Washington making $1 million per year would receive 10 times as much tax relief next year from expanding the state and local tax deduction as a middle-class family would receive from another provision in the social policy package, an expansion of the child tax credit. Citing calculations from the nonpartisan Urban-Brookings Tax Policy Center, the group said that two thirds of households making more than $1 million a year would get a tax cut under the legislation because of the increase to the state and local property tax deduction.The proposal has put some Democrats on the defensive.Rep. Jared Golden, Democrat of Maine, said this week that tax giveaways to millionaires sounded like something that Republicans would have come up with.“Proponents have been saying that the BBB taxes the rich,” Mr. Golden said on Twitter, referring to the bill known as the Build Back Better Act. “But the more we learn about the SALT provisions, the more it looks like another giant tax break for millionaires.”The issue is further complicating passage of the bill, which Democrats are trying to get through both the House and Senate without Republican support. Given their thin majorities in both chambers, Democrats can afford to lose no more than three votes in the House and none in the Senate.Some Democrats in Congress from states with high taxes have made the inclusion of the more generous deduction as a prerequisite for their backing the bill.“There’s a series of competing views on SALT, but I mean, it’s pretty obvious something has to be in there, that’s for sure,” said Representative Richard E. Neal of Massachusetts, the chairman of the House Ways and Means Committee.The unexpectedly tight race for governor of New Jersey was a clear reminder that the state’s high property taxes — and the limit on their deductibility — are high on voters’ lists of worries, strategists and other political observers said.“As Covid kind of recedes, taxes are taking its place as the top issue in New Jersey,” said Michael DuHaime, a Republican political strategist with Mercury Public Affairs.The SALT cap “essentially resulted in a pretty large tax increase for a lot of families” in the suburbs of New York City, Mr. DuHaime said. With Democrats in power, those homeowners are counting on some relief, he said.Now that former President Donald J. Trump is out of office, New Jersey has “reverted to its mean” of being deeply concerned about the state’s affordability, said Julie Roginsky, a strategist who advised Gov. Philip D. Murphy, a Democrat, during his first campaign in 2017. The average homeowner in the state pays about $10,000 in property taxes, she said, with the cap hitting about one-third of New Jersey residents.“I think it’s absolutely a line in the sand that some of these vulnerable members of Congress need to draw,” Ms. Roginsky said.Several Democrats who represent affluent suburban areas where most homeowners pay much more than $10,000 a year in property taxes will face stiff challenges in the midterm election next year, strategists said. Their short list of vulnerable House members include Josh Gottheimer, Mikie Sherrill and Tom Malinowski from North Jersey, and Andy Kim, who represents part of the Jersey Shore, all of whom support raising the SALT cap.If the Democrats can engineer a change to the SALT deduction that is retroactive to cover 2021 taxes, those incumbents can campaign on having provided a tax cut, Ms. Roginsky said. But if they fail, their Republican opponents — like Thomas Kean Jr., a state senator who is challenging Mr. Malinowksi — will be able to use that against them, she said.Several House Democrats who represent affluent suburbs, including Mikie Sherrill, whose district includes part of Montclair, N.J., are expected to face stiff challenges in next year’s elections.Todd Heisler/The New York Times“It may not play well in Vermont or in Alexandria Ocasio-Cortez’s district, but if you’re Nancy Pelosi, you understand that the road to your majority runs through places like suburban New Jersey and suburban California and suburban New York,” Ms. Roginsky said.Ben Dworkin, the director of the Rowan Institute for Public Policy and Citizenship at Rowan University in Glassboro, N.J., cited the unexpectedly close race for New Jersey governor this year. He noted how effective Mr. Murphy’s challenger, Jack Ciattarelli, was in playing to voters’ feelings about the state’s high taxes.“He hammered home that issue,” Mr. Dworkin said.Public polling leading up to that election showed that affordability in general was the “top issue” in the state, he said.Biden’s ​​Social Policy Bill at a GlanceCard 1 of 6A proposal in flux. More

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      The First Post-Reagan Presidency

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      Credit…Timo LenzenSkip to contentSkip to site indexOpinionThe First Post-Reagan PresidencySo far, Joe Biden has been surprisingly progressive.Credit…Timo LenzenSupported byContinue reading the main storyOpinion ColumnistJan. 28, 2021, 8:50 p.m. ETDuring Donald Trump’s presidency, I sometimes took comfort in the Yale political scientist Stephen Skowronek’s concept of “political time.”In Skowronek’s formulation, presidential history moves in 40- to 60-year cycles, or “regimes.” Each is inaugurated by transformative, “reconstructive” leaders who define the boundaries of political possibility for their successors.Franklin Delano Roosevelt was such a figure. For decades following his presidency, Republicans and Democrats alike accepted many of the basic assumptions of the New Deal. Ronald Reagan was another. After him, even Democrats like Bill Clinton and Barack Obama feared deficit spending, inflation and anything that smacked of “big government.”I found Skowronek’s schema reassuring because of where Trump seemed to fit into it. Skowronek thought Trump was a “late regime affiliate” — a category that includes Jimmy Carter and Herbert Hoover. Such figures, he’s written, are outsiders from the party of a dominant but decrepit regime.They use the “internal disarray and festering weakness of the establishment” to “seize the initiative.” Promising to save a faltering political order, they end up imploding and bringing the old regime down with them. No such leader, he wrote, has ever been re-elected.During Trump’s reign, Skowronek’s ideas gained some popular currency, offering a way to make sense of a presidency that seemed anomalous and bizarre. “We are still in the middle of Trump’s rendition of the type,” he wrote in an updated edition of his book “Presidential Leadership in Political Time,” “but we have seen this movie before, and it has always ended the same way.”Skowronek doesn’t present his theory as a skeleton key to history. It’s a way of understanding historical dynamics, not predicting the future. Still, if Trump represented the last gasps of Reaganism instead of the birth of something new, then after him, Skowronek suggests, a fresh regime could begin.When Joe Biden became the Democratic nominee, it seemed that the coming of a new era had been delayed. Reconstructive leaders, in Skowronek’s formulation, repudiate the doctrines of an establishment that no longer has answers for the existential challenges the country faces. Biden, Skowronek told me, is “a guy who’s made his way up through establishment Democratic politics.” Nothing about him seemed trailblazing.Yet as Biden’s administration begins, there are signs that a new politics is coalescing. When, in his inauguration speech, Biden touted “unity,” he framed it as a national rejection of the dark forces unleashed by his discredited predecessor, not stale Gang of Eight bipartisanship. He takes power at a time when what was once conventional wisdom about deficits, inflation and the proper size of government has fallen apart. That means Biden, who has been in national office since before Reagan’s presidency, has the potential to be our first truly post-Reagan president.“Biden has a huge opportunity to finally get our nation past the Reagan narrative that has still lingered,” said Representative Ro Khanna, who was a national co-chair of Bernie Sanders’s presidential campaign. “And the opportunity is to show that government, by getting the shots in every person’s arm of the vaccines, and building infrastructure, and helping working families, is going to be a force for good.” More