Monthly Archives: March 2015

Tell Congress ‘Hands Off’ the Mortgage Interest Deduction!

Fast Fact: The importance of the mortgage interest deduction can’t be ignored. Altering it could make home values fall. Even a 1% drop could cause a $200 billion loss for homeowners.

tax-matters

Life is filled with tough choices and Americans are facing a big one: should we continue to support the dream of home ownership or not? Because of what Congress is doing, that dream is at risk.

The mortgage interest deduction (often referred to as MID) has perhaps been the single most important tool that’s helped Americans afford to buy their own homes. Yet, Congress seems bent on reducing or eliminating it all together.

How Does the Mortgage Interest Deduction Help?

The MID makes the American dream of owning a home more affordable because it essentially lowers the amount of income tax homeowners pay. Making home ownership affordable helps keep all of our home values and communities on solid footing.

Who Uses the Mortgage Interest Deduction?

It’s a myth that only the rich use the deduction. In fact, over 60% of Americans who use the MID earn less than $100,000. And most of them are younger, middle class families just getting started. About 70% of all homeowners count on the deduction to help make their homes more affordable.

The MID saves these homeowners an average of $12,000. That’s hard-earned money to build a nest egg, pay for college, and save for retirement. Considering that homeowners pay the bulk of all income tax – 80%! – this deduction deserves our support.

Home values are finally increasing; let’s not put home values at risk again. Past changes to tax policies have resulted in drops in home values of as much as 30%, slamming the door to recovery.Even a mere 1% drop in home values could result in a $200 billion loss for American households.

So why would Congress consider reducing or eliminating the MID? It makes no economic sense.

Tell Congress ‘Hands Off’ the mortgage interest deduction by signing the petition at protectmyhometaxdeductions.com.

Or e-mail your questions to asktheexpert@shariolefson.com.

More on this topic



Guess Who Stopped the Squeeze on Oregon Homeowners?

Oregon Capitol Building

Oregon State Capitol Building.

At a time when the number of Oregon homeowners was at one of its all-time lows, state legislators tried to squeeze more revenue out of those homeowners—an average of $2,971 per property, to be precise.

That’s how much average Oregon homeowners see in tax savings from the mortgage interest deduction. But some legislators were moving to eliminate it in the 2013 state legislative budget sessions. Taking the deduction away just when the latest U.S. Census data revealed that homeownership had dropped to 1995 levels was a foolhardy idea, so the Oregon Association of REALTORS® organized opposition to it.

Through public awareness campaigns and efforts of individual REALTORS® across the state, more than 500 REALTORS® staged a “REALTOR@ Day at the Capitol” demonstration to voice their opposition to the legislation. End result: The deduction was kept in place.

Why Is the Mortgage Interest Deduction So Important?

Since 1913, this deduction has been an important means for Oregonians and all Americans to achieve the dream of homeownership and stay in their homes. Fewer Oregonians are able to clear the hurdles toward homeownership today because of stricter lending rules and a still-recovering economy.

Reducing real estate affordability by increasing potential homebuyers’ tax burdens only hurts the housing market, which has ramifications for the health of the state’s economy.

Watchful and Ready

What happened in Oregon was a close call that happens too often in other states, too. REALTORS®, through their local, state and national associations, remain ready to act when the dream of homeownership is at risk.