The National Association of Realtors has a giant ad atop the Rapid City Journal this morning asking Senator John Thune to keep mortgage interest and other homeownership related tax deductions as part of any tax reform package:
Can’t really disagree with them, as home construction is an economic engine for our country, which we really don’t want to throw a monkey wrench into. When we pass laws making it easier for people to afford homes, it benefits all of society.
Don’t forget the SaLT bullet point. Talk about missing your audience !
From what I understand, the bill now allows you to deduct the interest on the first $500,000 of your mortgage, ($1mil in Senate version) and the first $10,000 of property tax.
Honestly, how many people in South Dakota pay more than that now? And if they do, don’t you think they can likely afford it?
Maybe my stats are inaccurate. I would be interested to know if they are.
The home mortgage deduction is an example of cronyism. It makes no sense that a home owner who makes the same salary as an apartment dweller pays less in taxes than the renter. It is an income tax. The mortgage deduction is the result of special-interest groups looking out for their own bottom line at the expense of tax payers. Besides, the deductions that are being considered for elimination are for extremely large homes and/or second homes. What the members of Congress need to do is lower the rates FOR EVERYONE so that the deductions are not necessary, and that is part of plan currently being considered.
We do use tax policy to incentivize desired behaviors, such as home ownership. If that’s policy going forward, a smaller deduction for a single home is acceptable. $500k is a fairly impressive house in South Dakota, but there are
liberal hellholesplaces where that would be considered slumming. I’m OK with keeping it at that level or lower and limiting it to one house.