TAXES/TRUMP AS PRESIDENT: “The tax-overhaul plan being negotiated in Washington has the potential to virtually eliminate a break lawmakers once considered untouchable: the mortgage interest deduction.
The break allows homeowners to deduct from federal taxes money spent on interest tied to mortgage loans of as much as $1 million.
So far the deduction is one of the few being kept alive in the framework put forward by Republican leaders and President Donald Trump this month.
But while the mortgage deduction doesn’t face extinction, it might face irrelevance. That is because the tax plan also would almost double the standard deduction for individuals and couples, meaning only the highest earners would continue to itemize their deductions, and only a few of them would take the mortgage break. For most taxpayers, the standard deduction is likely to be the better option.
Currently, about 30% of U.S. homes are valuable enough to make it worthwhile to take the mortgage interest deduction, along with a deduction for state and local property taxes, according to an analysis by home search website Zillow. Under the proposed changes, the share would drop to just 5%, according Zillow.
The deduction is ‘more at risk than at any point in the last 30 years,’ said Isaac Boltansky, director of policy research at Compass Point Research & Trading, a Washington, D.C., investment bank.”
-Laura Kusisto, “GOP Tax Plan Would Keep the Mortgage Break But Threaten Irrelevancy,” The Wall Street Journal online, Oct. 16, 2017 07:44am