Sponsors (3)
The bill provides targeted federal tax relief to many lower- and moderate-income renters (including non-itemizers) by allowing a $4,000 rent deduction, but it reduces federal revenue, leaves higher-cost-area and higher-AGI renters with limited relief, and adds administrative complexity.
Renters (especially low- and moderate-income households) can deduct up to $4,000 of rent for their primary residence, lowering taxable income and reducing federal income tax liability.
Taxpayers who take the standard deduction (non-itemizers) — including many middle- and lower-income renters — receive the rental tax benefit because the deduction is available to non-itemizers.
Lower- and moderate-income households are prioritized because income-targeted phaseouts concentrate the benefit on those with lower AGI.
All taxpayers — federal revenues will be reduced by this deduction, which could increase deficits or require spending cuts or tax increases elsewhere.
Renters in higher-cost areas and higher-AGI renters — those above the AGI eligibility thresholds receive no benefit even if they pay substantial rent.
Renters in high-rent regions — the flat per-individual $4,000 cap may provide little relative relief where rents are much higher than the cap.
Based on analysis of 4 sections of legislative text.
Creates a federal tax deduction of up to $4,000 for qualified rent paid for a taxpayer's primary residence, phased out by AGI and available to non-itemizers.
Introduced March 3, 2026 by Greg Landsman · Last progress March 3, 2026
Creates a new federal income tax deduction that lets taxpayers deduct up to $4,000 of rent paid for their primary residence each year, subject to income phaseouts by filing status. The deduction is available to non-itemizers, is indexed for inflation after 2027, and applies to tax years beginning after December 31, 2026.