Quote:
Originally Posted by red-beard
John, I can't find anything, anywhere. If this were real, it would be all over the Wall Street Journal.
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I agree. Somebody's brother-in-law is misinformed or (my bet) doesn't exist.
Rick, in principle, I'm not convinced there should be a mortgage interest deduction, or any other favorable tax treatment for homeowners. For some of the same reasons you mentioned.
In practice, I think the deduction is "untouchable". Favorable tax treatment is built into house prices. For a $400K mortgage at 6%/30 years, the cumulative interest paid is very roughly $470K, assuming 20% effective tax rate and 4% discountr ate the present value of the mortgage interest deduction is very roughly $62K. Eliminating the mortgage interest deduction would cut the value of that house by 15% in theory and probably much more in practice. That would kick the legs out from under tens of millions of American families. They'd be burning politicians at the stake.