Mortgage deduction on the chopping block … bad idea?
I’m not so sure, and I’m a home owner. Well, more like a mortgage owner. The proposition apparently is being floated by the “non partisan” debt commission which, apparently has shoved medicare and medicare to the back of the table. Instead it’s mortgage deductions … and oh yeah, child tax credit.
From this morning’s WSJ on line.
The tax benefits are hugely popular with the public but they have drawn the panel’s focus, in part because the White House has said these and other breaks cost the government about $1 trillion a year.
At stake, in addition to the mortgage-interest deductions, are child tax credits and the ability of employees to pay their portion of their health-insurance tab with pretax dollars. Commission officials are expected to look at preserving these breaks but at a lower level, according to people familiar with the matter.
But lest you think this will be shared sacrifice or the debt commission intends to deal with all of the “tough” issues, well my brothers and sisters, think again.
Still, officials have found there aren’t any easy ways to balance the budget, and they are expected to steer clear of more polarizing issues like Medicare, Medicaid, Social Security and a broad rewrite of the tax code in their short-term recommendations. The panel could still make long-term recommendations to change these issues, but they would be less concrete.
If we were reforming the tax system and installing a flat tax, I would be very much in favor of this. A flat rate for all individuals, what did you make, send in X%. No deductions for anyone, anything. But then the Feds would give up, not so much revenue, they would give up power to manipulate winners and losers in this “free economy”.
On Cavuto’s Saturday show, the panelists were kicking around bailing out underwater homeowners and debating the fairness of one person getting a lower mortgage rate because they could no longer pay the higher rate while the more responsible person pays the higher rate.
Dagen McDowell doesn’t take the bait and surprised me when she came to the defense of … renters?
httpv://www.youtube.com/watch?v=1ug_lSg-C3E
5 Comments
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I don't like this statement because it falls under the mantle of "it's not their money". It only "costs" them in terms of the fact that they can't get their hands on the money and would love to do so. Only so they could spend it, or use it to cover current spending.
Secondly, the mortgage deduction has inflated house prices like student loans have inflated college tuition. The current group getting the benefit would have to be grandfathered out until balance was restored between housing costs and taxes.
As for the mortgage bailouts as described on your show, with 2% mortgages, I say let them rot! I have refinanced down from 8%, had scrimp and save to put almost 20% down, and paid PMI to cover the difference until I had 20% equity in my house. If I can do it, anyone can do it, and if you can't, you bought too much house. Time to move on. If I lived next to that woman that got her payment down to ~$700/mo from $1800, and I was paying the $1800 living next door, I would be mighty peeved, to put it mildly.
I'd be all for a flat tax if they would also end other policies that promote societal suicide: marriage penalties and subsidizing single mother welfare births, and (soon to be) abortions.
It is about power, taking from the still responsible and still independent and giving to their dependent power base.
Hear, Hear! Well spoken, winnie!
What Winnie said.
"Dittos"
Make that "Mega Dittos!"
I’m a renter.? Where are my tax breaks?? hmmmmm? (& my house wasn’t foreclosed on, it was sold for a loss)? Oh, yeah…I’m losing the child tax credit for the one child I could still use it on…the Bush tax cuts are going to expire (yay) because Fancy Nancy won’t bring that up for a vote before the elections…my health insurance just increased 50% even after a bunch of “unnecessary benefits” were hacked from the plan (thank you Obama & the Democrats for fixing health care in America)…I’m not angry about this administration anymore, I’m flat-out pissed off at the annihilation of the American way of life he’s brought with his “hope & change” crap.? I’m a cranky Yankee who does NOT like change, even on a good day, and now this goon has even hijacked the word “hope” to the point where I refuse to use it without quotation marks, denoting sarcasm.
Nope.? Not happy.? Not happy at all.