Several times over a period ofyears, American voters have sent aclear message for Congress: "Don'ttouch my mortgage interest deduction."
However, a recent draft proposalreleased by the National Commissionon Fiscal Responsibility andReform threatens this deductionthat provides thousands of dollarsof tax savings each year to some U.S.homeowners.
The commission - a bipartisangroup created by President BarackObama to help address the nation'sbudget deficit - recommends eithereliminating the mortgage interest deductionaltogether or severely limitingit, among other changes.
Currently, the mortgage interestdeduction allows homeowners toreduce their taxable income by theamount of interest paid on theirhome loan each year. Homeownerscan deduct the interest for up to $1million of mortgage debt and up to$100,000 of home equity loan debton both primary homes and secondaryhomes that aren't rented out.
Digital Access for only $0.99
For the most comprehensive local coverage, subscribe today.
A recent nationwide survey of800 likely voters commissioned bythe National Association of HomeBuilders shows that regardless oftheir political party affiliation orhomeownership status, Americansdon't want the mortgage interest deductionto disappear.
Here are some of the survey results:- 82 percent of renters and 72 percentof homeowners surveyed thinktax incentives to promote homeownership are reasonable.- 69 percent of Republicans,83 percent of Democrats and 70 percentof Independents surveyed saidit is reasonable for the federal governmentto provide tax incentives topromote home ownership.- 81 percent of the survey respondentssaid the mortgage interestdeduction should remain in the taxcode.
Critics of the deduction argue thatit favors high-income taxpayers overlower to moderate income earnerswho need it most. But according to theJoint Committee on Taxation,89 percent of taxpayers benefitingfrom the deduction makeless than $200,000 annually.Research by the National Associationof Home Builderseconomists - using the InternalRevenue Service statisticsincluding income data - alsoshows that the biggest beneficiariesare younger households,who typically have large mortgages,small amounts of equityin their homes and growingfamilies.
Current homeowners rely onthe mortgage interest deductionto help offset the costs ofhomeownership each year, andprospective buyers take thededuction into considerationwhen choosing homeownershipover renting. Any changeto the tax code that limits oreliminates the deduction willnegatively affect homeownershipin America.
Learn more and connect withothers who want to save themortgage interest tax deductionon Facebook at www.facebook.com/SaveMyMID or contactthe Home Builders Associationof the Lowcountry at 843-524-5203.
Patrick McMichael is a builder,partner in the construction firmBroad River Construction and vicepresident of the Home BuildersAssociation of the Lowcountry