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[Piecake]

A tax break popular with homeowners and the real estate industry could take a hit as Republicans look for ways to pay for their tax reform plan.

Despite promises from the Trump administration in April that it would “protect the homeownership … deductions,” multiple sources tracking tax reform said that the cap on the mortgage interest deduction — currently set at the interest on up to $1 million of mortgage debt — could be lowered in tax reform.

“I’ve seen proposals that drop it to $500,000,” said Rohit Kumar, lead on PricewaterhouseCoopers’ Washington tax policy team and a former senior staffer to Senate Majority Leader Mitch McConnell, one of the six congressional and administration leaders negotiating tax reform.

After tabling a 20 percent business tax on imported goods and services, known as border adjustability, Republicans need ways to pay for tax cuts so they can minimize the amount those cuts would add to the deficit. The Tax Foundation, a tax policy think tank, estimates that after factoring in negative economic consequences, $308 billion could be saved over the 10-year budget window Republicans are working with by lowering the mortgage deduction.

http://www.politico.com/story/2017/08/04/trump-homeowner-tax-benefit-241328

Doubt it happens, but this is something that I would actually be in favor of.

 

[Arrogant Bastard]

How can we give a larger tax break to the rich, oh we can fuck the poor.

-Edit-Should have said middle-class (this obviously depends on where you live and how you classify it).

 

[demosthenes]

I'm all for lowering it to debt on 500k.

How can we give a larger tax break to the rich, oh we can fuck the poor.

How does this give a tax break to the rich and fuck the poor?

Edit 2: Nobody is reading the article.

 

[PumpkinSpice]

How can we give a larger tax break to the rich, oh we can fuck the poor.

Yeah, fuck all those poor people buying million dollar houses.

 

[BlackLagoon]

http://www.politico.com/story/2017/08/04/trump-homeowner-tax-benefit-241328

Doubt it happens, but this is something that I would actually be in favor of.

Yeah, isn't this one of those economists think would be beneficial to get rid off in the long term, but is very popular and touching it is the political equivalent shoving your head down a meat grinder?

 

[Various Artists]

There is no way they have the balls to do this.

 

[NH Apache]

Goddamn jerks. Seriously a really useful tool during tax time and a big reason to buy a home. OF ALL THE THINGS THIS IS WHAT THEY CHOOSE.

Edit: thought they were removing it entirely. Misread.

 

[Piecake]

How can we give a larger tax break to the rich, oh we can fuck the poor.

Not sure how lowering the mortgage deduction to 500k fucks over the poor.

 

[kirblar]

This is actually a good thing. And it's even better if we get the GOP to do it because it's ridiculously unpopular to touch it.

Yeah, isn't this one of those economists think would be beneficial to get rid off in the long term, but is very popular and touching it is the political equivalent shoving your head down a meat grinder?

Yes. The net effect of the deduction is a handout to homeowners for being homeowners.

 

[Darryl M R]

If I'm understanding this correctly, I'm okay with this.

And I'm someone looking at buying a home in the next ~5 years around 600-800k.

 

[Steel]

Yeah, I'm not against it. That being said it'll probably be in the context of using the money saved for a tax reduction on the wealthy anyway.

 

[Deleted member 284]

How can we give a larger tax break to the rich, oh we can fuck the poor.

To be honest, this deduction helps home owners at the expense of the poor. Eliminating it is the third rail and if used to fund tax cuts, is problematic. But this deduction should go.

 

[Chumly]

We can save over 300 billion by just lowering to 500k. Let's do this immdediately!

 

[Syriel]

Yeah, isn't this one of those economists think would be beneficial to get rid off in the long term, but is very popular and touching it is the political equivalent shoving your head down a meat grinder?

Republicans will never vote for this.

Ever.

(It would bring housing prices down).

 

[cakely]

Just to be clear, a $500k cap on deductible mortgage interest would not be a tax on the poor. People paying off a $500k mortgage loan are not from the lower class.

This would be a remarkably progressive tax policy for the current administration.

EDIT: So it's not actually happening. Q.E.D.

 

[Randolph Freelander]

500K doesn't buy much of a house in parts of this country.

Leave the mortgage interest deduction alone.

 

[JaggedSac]

I was about to get pissed, but my house is under the $500k limit they mentioned, so I am good with it.

 

[PumpkinSpice]

500K doesn't buy much of a house in parts of this country.

Leave the mortgage interest deduction alone.

That still means only the wealthy are buying houses >$500k. They don't need government subsidy.

 

[Various Artists]

We can save over 300 billion by just lowering to 500k. Let's do this immdediately!

Why, that 300 billion is just going to corporations unless I am missing a /s somewhere?

 

[sangreal]

It really should be capped, but not to fund other tax cuts

 

[Arrogant Bastard]

Okay, poor isn't the proper term. So does this help or hurt middle-class families that own a home?

From the article:

“[L]imiting the mortgage interest deduction amounts to a de facto tax increase on current or future homeowners while putting homeownership further out of reach for prospective buyers,” said National Association of Realtors President William Brown in a statement. “We would have strong objections over any effort to further cap or limit the deductibility of mortgage interest.”

“By doubling the standard deduction and repealing the state and local tax deduction, [Trump’s] plan would effectively nullify the current tax benefits of owning a home for the vast majority of tax filers,” NAR said in a statement tied to the release of Trump’s tax goals.

 

[RMI]

this is fine, lol. buy a house you can afford damn.

*to clarify, I would be pissed if I had 500k-1000k in mortgage debt, but also, that would mean that I'm living in a half million dollar home at least, so maybe I don't have that much to complain about?

If this is just to fund more tax cuts for the wealthy in other ways then fuck that though.

 

[sangreal]

Okay, poor isn't the proper term. So does this help or hurt middle-class families that own a home?

From the article:

Why should there be tax benefits for owning a home? Because a Realtors association says so?

Even if you believe the (bad) ostensible reason -- encouraging homeownership as a savings vehicle for the middle class -- why should there be a tax benefit to owning a house that requires a $500k+ loan?

 

[GaimeGuy]

Lowering it or eliminating It? Big difference.

lowering it from 1 million to 500k would fuck over most of the east coast (mainly the Northeast Corridor) and California housing markets. Eliminating it would cause a recession


Either approach should be tiered to reduce shock.

 

[Muppet of a Man]

This sounds like a good thing, and it could have been a good thing if it was used as a way to raise revenue to pay for something like universal healthcare or free higher education, but because the Republicans are using it as an offset for tax breaks for the super rich, it will be a terrible thing that screws over the middle class AND the poor.

 

[Randolph Freelander]

That still means only the wealthy are buying houses >$500k. They don't need government subsidy.

Middle class people are buying those homes, too.

Remember, they just want to do this to give themselves more room to slash marginal tax rates at the top, which will be obviously in favor of the wealthy. Screw that.

 

[kirblar]

Okay, poor isn't the proper term. So does this help or hurt middle-class families that own a home?

From the article:

If you have a mortgage over 500K, it's very unlikely that you're middle class.

Of course it hurts them because a subsidy is being taken away for the value from 501K->1M. But why would you want to be subsidizing homes of that value anyway?

 

[PumpkinSpice]

Okay, poor isn't the proper term. So does this help or hurt middle-class families that own a home?

From the article:

Somehow I think the "National Association of Realtors," you know the people making commission on every home sale, might be a bit biased.

 

[br3wnor]

Can’t imagine the real estate lobby letting this happen, but as someone w/ a mortgage under $500,000 it wouldn’t effect me so not a huge loss if it were to go through. Months ago I heard the idea of getting rid of it completely being floated around and I’m glad to see they’ve backed away from that.

 

[jon bones]

sure, i dont need to own a house ever why not

and guys if you dont live in bumblefuck 500k IS middle class

 

[Arrogant Bastard]

If you have a mortgage over 500K, it's very unlikely that you're middle class.

Of course it hurts them because a subsidy is being taken away for the value from 501K->1M. But why would you want to be subsidizing homes of that value anyway?

I guess it really depends on where you live and how you classify the middle class. I don't think a 500k home is exceptionally expensive.

 

[Balphon]

Lowering the cap on the MID is probably a good idea.

However, it'd be extremely unpopular, and the GOP isn't exactly an entity I associate with political courage, so I'm not holding my breath.

 

[Piecake]

Okay, poor isn't the proper term. So does this help or hurt middle-class families that own a home?

From the article:

Do you really think that the NAR is an objective party in this?

All economists from both sides of the political spectrum think the mortgage deduction is AWFUL.

Even reducing it and giving the money saved to the rich through tax cuts is better than keeping it due to the bad consequences the deduction causes to the housing market.

 

[ZackieChan]

How can we give a larger tax break to the rich, oh we can fuck the poor.

Do you just have a file called "responsestorepublicanthreads.txt" where you copy and paste hot takes?

 

[zero_suit]

Hmm, one of the few good ideas from this administration.

 

[FrontalMonk]

I'm closing on a single family home on Monday for 210, so this works fine for me. It wouldn't have worked for me in NOVA, where 500k will get you a townhouse, but that's half the reason I moved.

 

[kirblar]

sure, i dont need to own a house ever why not

and guys if you dont live in bumblefuck 500k IS middle class

The proposed change is things over 500K.

I agree that 500K can be middle class in some places.

1M is "middle class" absolutely nowhere.

 

[Raylan Targaryen]

“They’re willing to ruffle some feathers,” said one attendee of Monday’s meeting. “Everything was on the table,” including capping the deduction that the Trump administration has said it would preserve.

cuz you know, Trump is such a man of his word

 

[Lord Fagan]

Well, this is to be expected given that their entire previous tax proposal was based on making the individual mandate for healthcare going away. It's why Trump kept telling them to vote again and again on repeal even though every GOP senator knows that's basically squeezing blood from a stone, at this point.

Something has to balance the sheets, GOP budget hawks have to find the money somewhere, and if it can't be any of that precious rich people money, obviously the middle-class can take up the slack like it's done for the last four goddamn decades, or so.

 

[Arrogant Bastard]

Do you just have a file called "responsestorepublicanthreads.txt" where you copy and paste hot takes?

Yes.

 

[Taramoor]

Given the way legislation has evolved in this congress so far this year I imagine "cutting it to $500,000" will quickly change into "no deductions on houses below $1.5 Million assessed value"

 

[ItWasMeantToBe19]

Raising the taxes on the top 2-5% to cut taxes on the top 1% is an extremely stupid idea.

 

[Randolph Freelander]

Yes.

It's not as if it doesn't come in handy!

 

[Phrozenflame500]

Actually a good idea. Which is why I'll believe it when I see it.

 

[badrang]

I'd love it if they just got rid of the mortgage interest tax deduction entirely..

 

[woodchuck]

I'm for this but hate that they are doing this to fund other tax cuts

 

[gcubed]

I think its a good idea, which means they wont do it

 

[Amory]

I'm for it. Not to fund your shitty tax plan, but I'm for the idea of limiting the mortgage deduction in general

 

[Shake Appeal]

I'm for this but hate that they are doing this to fund other tax cuts

Exactly. I have a mortgage and I'm in favor of losing this deduction.

I guess it really depends on where you live and how you classify the middle class. I don't think a 500k home is exceptionally expensive.

Granted that it does vary based on where you live, anyone who has a 500K home that they can afford is doing fine. They're very likely in the top quintile of American wealth.

 

[zelas]

This is something that should have happened a while ago but its so popular. I'd be surprised if Republicans in their current position would allow it.