ALPHARETTA, Ga. -- On the income distribution charts at the center of tax overhaul plans, Courtney Mishoe knows she's doing well. She works as a tax manager at a firm in the Atlanta suburbs. Her husband is a police officer. Together they make more than $180,000 a year. They are solidly in the upper middle class. But they have a mortgage and three kids, including one in day care and another in high school with plans to go to college. It all adds up. They depend on tax deductions to make their budget work.
"I don't feel wealthy," Mishoe said. "I don't have a bunch of money stashed away anywhere."
Mishoe is the type of person -- affluent enough for an annual family vacation but not enough for a boat or second home -- who potentially stands to lose under the Republican framework for changing the country's tax code, which threatens to eliminate or deeply cut deductions for mortgage and student loan interest and state and local taxes. These popular deductions are widely viewed as sacrosanct in high-tax, high-cost states like New York, New Jersey and California, where residents have led the fight against the proposed changes.
But what has been widely overlooked is that residents of well-to-do suburbs in red and blue states across the nation could find themselves in a similar tax squeeze. This threatens to further complicate efforts to pass a tax plan that many Republican officials view as essential after a year of legislative struggles. Both the House version, which passed out of a critical committee Thursday, and the Senate version, released Thursday, target this group of upper-middle-class Americans to raise revenue to offset other tax cuts.
The tax push illustrates the political risks of attacking provisions favored by prosperous but far-from-rich suburbanites, a powerful voting bloc that often faces the financial stress of living in increasingly pricey neighborhoods. Many in the GOP already are worried about losing their grip on this important group after Tuesday's result in the Virginia governor's race, where Democrat Ralph Northam crushed Republican Ed Gillespie by running up votes in the dense areas outside cities.
Alpharetta is part of a booming region known as North Fulton, where no one bats an eye at $600,000 homes, Whole Foods and West Elm are eager to locate, and property taxes are relatively high to fund the top-performing public schools that attract striving white-collar professionals. And when it comes to their taxes, residents often have more in common with people living just outside New York City and Washington, D.C., than those in other parts of Georgia.
The Republicans' plan proposes to offset $2 trillion in tax cuts in part by going after the deductions enjoyed by the upper middle class, generally those earning $100,000 to $250,000 a year, representing about the top 80 to 95 percent of earners. The Joint Committee on Taxation found, for instance, that nearly 90 percent of the state and local tax-deduction benefit went to people earning more than $100,000. The House plans would cap the deduction at $10,000. The Senate plan is said to eliminate the deduction entirely.
In Georgia's 6th Congressional District, which contains most of North Fulton, nearly half of tax filers took this deduction, well above the national average and on par with expensive coastal states.
"These people will probably be hit," said Roger Lusby, a tax accountant in Alpharetta, who said he was disappointed by the Republican's offerings. "They just don't realize it yet."
Rep. Karen Handel, a Republican representing the 6th District who won a closely contested special election here earlier this year, defended the plan by pointing to another Joint Committee on Taxation study that found all income groups in the nation would see lower taxes in the short term, on average. But the report did not break down the impact at the local level, and other nonpartisan research has shown that about a third of taxpayers in this income group would pay more. Handel said it was a mistake to focus on deductions.
"It's important to look at this in the totality," she said.
Brandon Beach, a local state senator, said he was confident that residents would see lowered individual tax bills in the final proposal.
"This is a tricky thing," Beach said. "You've got to start somewhere."
North Fulton seems like a place that could afford to pay more in taxes, but residents say their low-six-figure incomes obscure the economic challenges of living here.
A string of prosperous suburbs aligned along an eight-lane highway known as Georgia 400 that funnels cars and light-rail trains into the heart of Atlanta, the region has been transformed in the past two decades into a sought-after community with increasingly dense subdivisions and corporate campuses filled with technology and health care firms. The headquarters of huge firms such as UPS, First Data and Veritiv are located here.
Homes nearby sell for $500,000 to $800,000. And new construction is constant, with signs in front of unfinished Craftsman-style townhouses that wishfully boast "from the mid-$500s."
Yet, said Tracey Craft, a local real estate agent, "you can't get them for them for anywhere near that."
Other residents say North Fulton is a place where earning $100,000 -- nearly twice the national median household income -- means a surprising degree of struggle.
"Some of them are living paycheck to paycheck," Ted Jenkin, a financial adviser, said. "You would imagine that people are fairly well-to-do even with $200,000. But they don't consider themselves to be rich. It's challenging."
Lusby, the accountant, said people earning up to $250,000 in this region "don't consider themselves to be high-earners."
He distinguished between income and wealth. Few of his clients in this bracket were socking away much for retirement or college costs. They might have a nicer house, maybe a few extras, "but they feel like it's all being spent and, for the most part, that's true," he said.
If Congress no longer allows individuals to deduct state and local income taxes, including property taxes, from their federal tax bills, it could change the calculus of places like Alpharetta. Education, funded by property taxes, is one of the region's main selling points. Officials here credit the public schools -- stocked with Advanced Placement and honors classes -- with helping to persuade Mercedes-Benz two years ago to relocate its North American headquarters and 1,000 high-paying jobs from New Jersey to Sandy Springs, a town near Alpharetta in the same county.
Broadly speaking, the Republican attack on deductions is being cheered by many economists and analysts, who have complained for years that the tax code favors deductions not available to most Americans.
But where agreement breaks down is that while many in the upper middle class will be asked to pay more, the very rich won't be.
"I do think the plan seems to be asking more from the top 20 percent," said Richard Reeves, a senior fellow at the Brookings Institution who recently wrote a book called "Dream Hoarders," accusing the upper middle class of gaming the system to their advantage.
But Reeves questioned a tax plan that places a greater burden on the upper middle class and delivers most of the benefits to the truly rich, the top 1 percent.
"That's absolutely not the right way to do it," Reeves said.
The tax plan, if passed, could further complicate the region's reputation as a reliably Republican stronghold. The district has a long streak of sending a Republican to Congress, including Newt Gingrich and later Tom Price. President Donald Trump edged out a win in the district last fall, in a state that he won by five points.
After Price was tapped to be Trump's secretary of Health and Human Services -- a position he later resigned -- a runoff election became the most expensive House race in history, when Handel narrowly beat out Democratic challenger Jon Ossoff.
In Alpharetta, many people said they could not determine how they would make out under a confusing plan littered with caps and phase-ins.
As he ate lunch at Alpha Soda, a popular local restaurant, Chris Krogh said he hadn't followed the debate closely but was troubled by what he heard. Krogh runs a custom cabinetry business and depends on homeowners as customers.
"I always thought Republicans were supposed to be good on the tax breaks," he said.