Dear Senator:
Currently the Internal Revenue Code allows deduction of mortgage interest on mortgages of up to $1 million. You can deduct mortgage interest for a first and second home. This is an over-simplification, of course – see http://www.irs.gov/publications/p936/ar02.html or consult your tax adviser for a more thorough explanation.
The nonpartisan Joint Committee on Taxation says the mortgage interest deduction will decrease tax revenues for FY 2011 by $93.8 billion. (Source: http://articles.latimes.com/2011/jan/23/business/la-fi-harney-20110123) To put this in context, the CBO projects total revenues of $2.228 trillion and total outlays of $3.708 trillion for a deficit of $1.48 trillion for 2011. (And really, if there’s no context, it’s meaningless, right?) So this means if you eliminated the mortgage interest deduction and kept outlays constant, the deficit would be $1.39 trillion for 2011. That’s a 6.1% deficit reduction.
Harvard economics professor Edward Glaeser has some interesting thoughts on the mortgage interest deduction. Most notably, Glaeser concludes that “the home mortgage interest deduction is poorly designed to encourage homeownership, which is, after all, the alleged desideratum.” I’m sure you’ll find Prof. Glaeser’s article of interest: http://economix.blogs.nytimes.com/2009/02/24/killing-or-maiming-a-sacred-cow-home-mortgage-deductions/
Please tell me whether you are FOR or AGAINST keeping the mortgage interest deduction status quo. If you are FOR the status quo, please explain why. Also, if you are FOR the status quo, perhaps you disagree with Prof. Glaeser’s conclusions. In that case, please feel free to explain your disagreements. If you are AGAINST the status quo, please tell America what changes you’d like to see made. Thank you in advance for your response, which I will post on my blog.
Regards,
luridtransom
No comments:
Post a Comment