Rove's Texas residency status negates D.C. tax deduction

Sept. 3, 2005, 10:32PM

Rove's Texas residency status negates D.C. tax deduction
He is paying the back tax after rules change; now Hill Country property brings scrutiny
By LORI MONTGOMERY
Washington Post

WASHINGTON - Presidential adviser Karl Rove may live in Washington. But in his heart — and for voting purposes — he remains a Texan. Which means he is not legally entitled to the homestead deduction and property tax cap he's been getting on his Washington home for the past 3 1/2 years.

Last week, the District of Columbia tax collector was alerted to the problem. And Rove agreed to reimburse the District for an estimated $3,400 in back taxes, city officials said. But now some Lone Star officials also are wondering about the place Rove calls home.

In a letter released Friday by the White House, the D.C. Office of Tax and Revenue accepted blame for the error, which also has affected numerous members of Congress. The homestead exemption gives District taxpayers a substantial tax break on their primary residences. But starting in 2002, a change in the law made it available only to Washington property owners who do not vote elsewhere, city officials said. That made Rove, and many others, ineligible.

"OTR failed to rescind the benefit when the law changed. As a result of OTR's error, the property inadvertently received tax deductions for which you no longer qualified," chief assessor Thomas Branham wrote Rove.

Rove, who was touring the hurricane-damaged Gulf Coast with President Bush on Friday, was unavailable for comment, White House spokeswoman Erin Healy said. She said Rove never intended to make an improper claim to the deduction.
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http://www.chron.com/cs/CDA/ssistory.mpl/politics/3338688
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