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Proposals could cut mortgage deductions
San Jose Mercury News ^ | 8/29/09 | Kenneth Harney

Posted on 08/30/2009 8:45:34 AM PDT by ProtectOurFreedom

...arlier this month the nonpartisan Congressional Budget Office delivered its latest revenue-raising options for Senate and House consideration as they write this fall's tax and budget legislation.

Tucked away in the report are several incendiary plans that could — if adopted — cost homeowners billions of dollars. Though not formal legislative proposals, the CBO's options represent a handy fiscal menu for legislators to pick and choose from to reduce the deficit — now at unprecedented levels — or to pay for new programs they might want to advance.

Tops on the CBO's hit list for housing: Slash deductions for homeowner mortgage interest from the present $1.1 million limit to $500,000, phased in with $100,000 annual reductions starting in 2013 and extending to 2019.

Under current law, taxpayers can write off mortgage interest on their principal home debt up to $1 million, and on home equity debt up to $100,000.

Under the CBO's option, that maximum mortgage debt amount would shrink yearly until it hit $500,000.

Over a 10-year period, this change alone would boost federal tax collections by an estimated $41 billion.

The CBO offered up a second option if Congress wants to raise a lot more money: Replace the current mortgage interest deduction with a flat 15 percent tax credit for everybody with mortgage amounts below the declining limits in the first option. Rather than taking write-offs that are tied to your personal income tax bracket, every homeowner would get a credit worth 15 percent of mortgage interest paid.

Who'd benefit? Primarily lower- and moderate-income taxpayers who don't itemize on their returns. Who'd pay more? People with big mortgages and higher-than-average incomes, who are far more likely to itemize under current rules.

(Excerpt) Read more at mercurynews.com ...


TOPICS: Business/Economy; Government; News/Current Events
KEYWORDS: bho44; bhocbo; bhotaxincrease; cap; deduction; mortgage
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To: ConservativeInMaine
The “Obama Elite” might live in the fashion you speak of - but if you look at most socialists countries, “the people” live in crappy high rise boxes. Liberal elites would have us all living in Cabrini-Green if they could get away with it... I lived in Chicago's Hyde Park in the 60’s - the elite intellectuals lived in nice brownstones - the “poor” lived in public housing that reduced them to little more than animals. And yeah, I lived in a great brownstone - with my socialist, extended Shimer/University of Chicago family - but I visited Cabrini-Green - I know what horrors liberals can come up with...
61 posted on 08/30/2009 12:01:48 PM PDT by GOPJ (Socialism : "Envy" gussied up as a political cause...... David Horowitz)
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To: ConservativeInMaine

Tell me about Manhattan... What has happened?


62 posted on 08/30/2009 12:03:18 PM PDT by GOPJ (Socialism : "Envy" gussied up as a political cause...... David Horowitz)
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To: GOPJ

It’s the safest urban area in the world.


63 posted on 08/30/2009 12:22:42 PM PDT by ConservativeInMaine
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To: paul51; org.whodat; misterrob; Regulator

What do you say to Regulator’s post #15?


64 posted on 08/30/2009 12:25:51 PM PDT by ecomcon
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To: GOPJ

My post wasn’t necessarily about the virtues of city living vs. suburban or rural living, only to state that many people live an urban lifestyle by choice because it is what they enjoy, and also to point out that renting does not make someone “broken” or otherwise easy to control or whatever it is that was being implied.

Many many homeowners are heavily indebted to banks. These days, many of those are indebted beyond what they could repay even if they sold their homes. How is that a more free, unencumbered, liberated way of living than renting?

I have the freedom to pick up and move whenever I choose; I have the financial flexibility to save my extra income in a variety of ways. Yes...I have given up some things: many people truly did become wealthy because of their home investments...but not most of the people my age, many of whom are currently struggling with sagging home prices. I obviously will not become wealthy renting an apartment, but it is a lifestyle that has some benefits which shouldn’t be ignored.


65 posted on 08/30/2009 12:28:16 PM PDT by ConservativeInMaine
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To: ProtectOurFreedom

Re-pa-ra-ti-ons. In camoflage. If it helps some porr whites well that’s not what was intended but we gotta appear unbiased and keep people unawares to what we’re doing.


66 posted on 08/30/2009 12:30:37 PM PDT by Secret Agent Man (I'd like to tell you, but then I'd have to kill you.)
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To: BobL

On the issue of student loans you will find me in 100% agreement. There is a reason that over the last 40 years medical costs and student tuition have increased at thrice inflation. It’s called third payer.


67 posted on 08/30/2009 12:31:06 PM PDT by xkaydet65
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To: Regulator

I was replying to #37.


68 posted on 08/30/2009 12:33:11 PM PDT by xkaydet65
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To: Blue_Ridge_Mtn_Geek
Bigger homes use more energy. The deduction is therefore implicitly urging Americans to run higher electricity bills and spend more on home heating. If global warming is a serious problem, then the government should be encouraging us to live in smaller, not bigger, dwellings.

This from a "libertarian"? Statist declarations from on high about what kind of home we should live in?

69 posted on 08/30/2009 12:36:18 PM PDT by ecomcon
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To: ecomcon
What do you say to Regulator’s post #15?

I'd say don't tax the income or the expense. Get rid of the IRS and get the government out of manipulative tax code schemes that create more problems and more government. A simple, flat consumption tax can fund what we need to.

70 posted on 08/30/2009 12:41:53 PM PDT by paul51 (11 September 2001 - Never forget)
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To: Hodar

The damned AMT was already taking a good portion of it. Now they want to kill off the rest.


71 posted on 08/30/2009 12:44:25 PM PDT by dfwgator
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To: Always Right
"That is not $1.1 million of interest, but interest on a $1.1 million loan or loans. Not well worded. "

The writer was probably educated by a union member.

72 posted on 08/30/2009 12:45:41 PM PDT by blam
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To: xkaydet65
I know. Was basically just agreeing with/reinforcing your comment.

Seems everyone including the so-called "Republicans" forgot the principle of no double taxation.

73 posted on 08/30/2009 1:03:49 PM PDT by Regulator (Welcome to Zimbabwe! Now hand over your property)
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To: ConservativeInMaine
That was Guliani's broken window fix up. It's held for years - that and the lawful fallout of welfare reform. But trust me - those reforms were done by conservatives. Pushed by them against all democrats. Clinton signed it - but none of the details were his idea - and the SAINT Kennedy voted against it. And until those ideas worked - liberals were totally against them.

I liked living in a large city - but the more liberal ideas involved - the more horrors.

74 posted on 08/30/2009 1:39:02 PM PDT by GOPJ (Socialism : "Envy" gussied up as a political cause...... David Horowitz)
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To: BobL
Another example, student loans. They were supposed to ‘help’ students pay for college - instead they help colleges raise their tuition at something like twice the rate of inflation (if not higher). Net effect...a bunch of VERY WEALTHY professors of the humanities and a bunch of shattered lives from people who got stuck with the loans.

I just don’t like the distortions created by the government...perhaps others don’t mind (or don’t see the whole picture).

-

For people who can "see" - these are "consequences". For those who can't see down the road, they're "unintended consequences". For liberals they're "we feel we are helping students, so we are helping students and if you show us facts contrary to our "feelings" it means you hate students". Or some such irrational garbage...

75 posted on 08/30/2009 3:18:17 PM PDT by GOPJ (Socialism : "Envy" gussied up as a political cause...... David Horowitz)
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To: FrankR

As soon as most are renting - the gov will put the screws to renters.


76 posted on 08/30/2009 3:22:06 PM PDT by GOPJ (Socialism : "Envy" gussied up as a political cause...... David Horowitz)
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To: org.whodat
"The incentive is you need to keep you and your ass dry and warm, not to mention the family. "

I've been handling that "incentive" quite handily for over 45 years now, thank you. My frustration with an asinine suggestion for a "bill" was not an invitation for lifestyle advice. Oh, and my family is just fine...dry AND warm.
77 posted on 08/30/2009 3:26:57 PM PDT by FrankR (We are only enslaved to the extent of charity we receive....INCUMBENTS OUT!!!)
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To: ProtectOurFreedom
It's the continual changing of tax laws and social engineering that have to stop. Take the power away from Congress and pass the Fair Tax now.

Government should not be able to “incentivize” via tax breaks all aspects of our lives, let the free market work. Look what happened when Congress tried to make home ownership available to uncreditworthy people, we are paying for that now, WHY?

78 posted on 08/30/2009 3:32:08 PM PDT by rolling_stone (no more bailouts, the taxpayers are out of money!)
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To: FrankR

Good deal so you really don’t need the tax welfare check.


79 posted on 08/30/2009 3:44:02 PM PDT by org.whodat (Vote: Chuck De Vore in 2012.)
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To: org.whodat
"Good deal so you really don’t need the tax welfare check. "

Well, I wouldn't want to "cheat" any obamaites out of their subsistance...
80 posted on 08/30/2009 3:52:35 PM PDT by FrankR (We are only enslaved to the extent of charity we receive....INCUMBENTS OUT!!!)
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