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JimVanMeerten (62.35)

Washington targets you home mortgage deduction

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July 08, 2010 – Comments (5)

The Robama Hood administration continues in its quest to rob from the "rich" and give to the "poor". For some reason they have made it their quest to punish families making over $250K and redistribute their "ill gotten" gains to those making less than $40K.

His latest target is your mortgage interest deduction (MID). The Tax Policy Center notes that those making under $40K get an MID of only $91 while the filthy rich making over $250K get an MID of $5,459. The Robama Hood administration estimates that the MID will "cost" the Treasury $131bn in 2012. Can you believe that they think the American homeowner is robbing the Treasury. Since when is the Executive Branch's mission to maximize taxes?

Did my parents raise me wrong? They taught me to study hard and get as much education as I could so I'd land a good job. They also instilled in me that I should find that right person with similar values, get married and have kids when you can really afford them.

I'm not going to make any moral judgement but let's compare 2 life styles:

Life style number one is a married couple who kept their noses to the grindstone and applied themselves in school until they both had advanced or professional degrees. After they established themselves in their respective careers brought children into their world.

Life style number two are players who don't take advantage of the free education offered all children in the USA and drop out of school. They together or individually decide that having children is a right not a responsibility so just have kids even if you are single or can't afford to raise them.

Which lifestyle do you think is more likely to make over $250K and which one is more likely to make under $40K?

The Congressional Budget Office is recommending replacing your mortgage interest deduction with a 15% tax credit and lowering the limit on the size of you eligible mortgage.

Do we live in the United States of America -- The Land of Opportunity or Sherwood Forest?

Jim Van Meerten is an investor who writes on investing here and on Barchart Portfolio Blogs. Please leave a comment below or email JimVanMeerten@gmail.com.

5 Comments – Post Your Own

#1) On July 08, 2010 at 3:59 PM, leohaas (31.56) wrote:

More to the point: why does anyone "deserve" a deduction because he/she pays a mortgage? And since when is abolishing a deduction robbery?

PS  Libertarians need not respond. I know that they believe that all taxation is robbery!

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#2) On July 08, 2010 at 4:11 PM, chk999 (99.97) wrote:

The mortgage tax deduction was a piece of social engineering to start with. It was put in place to increase the percentage of home ownership. Once you let the camel's nose of social engineering into the tent, you get the whole camel of various power groups trying to sway it to their advantage pretty quickly.

This is an obvious thing for the Obama admin to do, they get a lot more votes from people under 40K than from people over 250K.

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#3) On July 08, 2010 at 5:07 PM, starbucks4ever (97.24) wrote:

If Obama had any intention of repealing mortgage interest deduction, I would even forgive him the homebuyer tax credit. But I don't think I will ever need to change my very low opinion of this president because I feel he has no intention to do anything about MID in the best case, and he may have an intention to extend MID even further in the worst case.

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#4) On July 08, 2010 at 9:31 PM, ChrisGraley (29.75) wrote:

leohaas, I think that Libertarians would agree with you that there shouldn't be a mortgage deduction.

 

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#5) On July 09, 2010 at 9:29 AM, JimVanMeerten (62.35) wrote:

One man's tax loop hole is another man's tax incentive.

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