Tax Subsidies for Commuting Lawmakers?

October 31, 2005

With the President’s tax reform panel likely to recommend cutting back popular tax deductions for interest on home loans and state and local taxes, the Associated Press reports on a particularly egregious tax subsidy for traveling state lawmakers that’s being ignored:

A little-known tax break specifically for legislators can allow them to save thousands of dollars.

The federal tax code allows legislators who live more than 50 miles from the Capitol a $141 tax deduction for each day they are in legislative session or attending a committee meeting. They also get the tax break when they are home, provided that no more than four days pass between these legislative business days.

The “four-day rule,” as some have called it, applies only to state and federal lawmakers who live more than 50 miles from the Capitol …

The Patriot-News of Harrisburg paid an accountant to compare the tax bill of a legislator with that of a salesman, with both earning the new legislative base pay of $81,050 a year. The legislator would pay nearly $2,400 less in federal and state taxes because of the provision.

…Internal Revenue Service officials were unable to provide an explanation as to who was behind the provision’s insertion into the law or the justification for it. (Read the full story here.)

The relevant section of the Internal Revenue Code is Section 162(h) on “State legislators’ travel expenses away from home.”

At a time when other federal tax deductions like the one for home mortgage interest are on the tax-reform chopping block, Members of Congress should lead by example and offer up their own special and unjustified tax provisions—which this one clearly is—as first on the list for repeal.


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