Quigley, Walz Introduce Bill to End Tax Loopholes for Luxury Yachts

WASHINGTON – Today, U.S. Representatives Mike Quigley (IL-05) and Tim Walz (MN-1) introduced legislation to eliminate taxpayer subsidies for yachts. The Ending Taxpayer Subsidies for Yachts Act will amend a tax provision that allows boat owners to write off their mortgage interest payments if they classify their boats as second homes.

“There’s absolutely no reason why taxpayers should subsidize luxury yachts, especially when the vital education and living assistance programs people rely on are threatened with massive cuts,” said Quigley. “As we work to get our fiscal house in order, we have to reform our tax code and put an end to frivolous tax loopholes like these.”

“Closing this tax loophole is a no-brainer,” said Walz. “The Mortgage Interest Deduction was made to help middle class families own a home and achieve the American Dream, not to subsidize yachts for the super-rich.”

The bipartisan Joint Committee on Taxation estimates that the Ending Taxpayer Subsidies for Yachts Act would save more than $150 million over the next ten years. Currently, taxpayers are allowed to deduct mortgage interest for up to two homes from their tax returns. Yachts equipped with bedding, toilet facilities and a kitchen qualify even if they aren’t used as a primary residence. The bill would limit the tax deduction to only those who use their boats as a primary residence.

Rep. Quigley recently called on Congress to reform America’s tax code and introduced the bipartisan Budget Process Improvement Act earlier this year. He is also the author of Reinventing Government: The Federal Budget, which offers 15 recommendations to establish greater budgetary accountability, as well as 60 recommendations to save $2 trillion over the next 10 years.