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Mark Stroup

Running a press is no picnic, either. As one friend describes it, "one person runs the machine, and the other person turns the machine off if the first person gets caught in it."

Mark Stroup

Oops. Wrong entry.

Jonathan Potts

There's been talk for a while about eliminating the home mortgage deduction from federal income taxes. I believe there was a tax-reform commission that included that idea amongs its recommendations. Politically, it's probably a non-starter, but it is worth considering. Many economists think the deduction does not help people buy homes who could not otherwise afford them; it merely allows people who already can afford a home buy a bigger one. I discussed this here:

http://jonathanpotts.blogspot.com/2005/11/bringing-down-house.html

sean mcdaniel

you know, i think that the reason home owners get a break on mortgage interest deductions is because they bear the burden of paying school taxes, which are based on property.

as for people looking to buy "smaller" homes, i'm not seeing it around here...yet. even so, that 1,700 square feet is still about 400 more than I enjoy now.

Jonathan Potts

Those taxes are also deductible. Owning a home is what gives most people enough deductions to exceed the standard deduction, which then allows some--though not all--homeowners to deduct local wage taxes, unreimbursed business expenses, some health care expenses, charitable contributions, etc. As a renter, none of those options were available to me.

The mortgage interest deduction was a way to spur single-family home construction and ownership, pure and simple. The most powerful interests to oppose any tinkering with the deduction are the real estate and construction industries.

Sam M

My "flat tax" friends always point to the mortgage deduction as one of the primary political hurdles to eliminating the income tax.

And it does pose serious questions. What do you do with someone who bought a house and calculated the deduction into the family budget. Say they have been living in that house 15 years. Now all of a sudden...

Now multiply that by about 25 million times across the country and you have a real bombshell.

Or do you grandfather those people in. Let them keep taking the deducation and just say "No mas." People like me who do not yet own a house would send up a howl of protest.

Ah, politics.

But just to be clear, I would support rescinding the deduction if it came as part of a larger simplification package. A real one. Even if I got screwed in the process.

Someone has to get screwed, I suppose.

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