Posted on 07/20/2011 4:19:53 PM PDT by NormsRevenge
WASHINGTON (AP) — A new bipartisan plan to reduce government borrowing would target some of the most cherished tax breaks enjoyed by millions of families — those promoting health insurance, home ownership, charitable giving and retirement savings — in exchange for lowering overall tax rates for everyone.
Many taxpayers would face higher taxes — a total of at least $1.2 trillion over the next decade, and perhaps more.
The details and impact of the plan, released this week by the bipartisan "Gang of Six" senators, emerged as President Barack Obama called congressional leaders to the White House on Wednesday to determine, in separate meetings, their bottom line for extending the nation's debt limit while also cutting spending at the greatest amount possible. The role of additional tax revenue remained a sticking point.
(Excerpt) Read more at news.yahoo.com ...
As I said in my very first post on the thread, eliminating this deduction needs to be partnered by an overall decrease in tax rates.
The only reason this country became what it is since 1776 is because of capitalism, whereby you get to keep what you work for. It is why we live in air conditioned homes with food in the refrigerator and indoor plumbing. Take away the incentive to work, and what do you have...a bunch of sheet heads living in tents with a sand floor, wiping with their left hand.
Do you -—>really<—— think the two will happen?
Insisting that people get a tax break for purchasing the products of just one industry, but no others, is a long way from my definition of capitalism. The people who build airplanes and golf carts and floodlights and pizza ovens deserve exactly the same rights in the marketplace as those who make houses.
Personally, I would walk away from my home, could not afford it, and evict my renters in their homes, or double the rent, or simply torch them and get in line to get handouts paid by your taxes.
So what did you do with extra $300? :)
and they get those rights, called expense deductions. Why should they write off their expenses, and not people who have rentals as a business, homes or commercial? Why would you give feds the power to eliminate this business expense, and not the other, such as wear and tear, depreciation, and the cost of the wholesale item?. They are all business deductions, the cost of providing the product, in this case, the home, or office building.?
“the purpose of the tax code is to raise money for the government”
maybe it started as so but that is a way too simplistic statement that does not describe the US tax code, and hasn’t for a long long time
for your entire lifetime and mine, the tax code has been used to incentivize, reward/punish, and encourage certain activities, ostensibly for the good of our economy and our society
cigarettes bad? tax them heavily. home ownersip good? tax it lightly
the mortgage tax deduction is/was intended to subsidize and encourage home ownership, to stabilize communities, to help individuals create stability and wealth, to create jobs in many many different related industries in communities
Have these interests become obsolete or passe?
It will be very interesting to see the net gain in income to the govt (and to the local communities heavily supported by property taxes), and the effect on individual wealth and jobs, once the mortgage deduction is gone
So people who own property they don’t live in can deduct interest payments while the person livimg in their owm home can’t? I guess you could set up a corporation to own your house.
Exactly. Crisis in mortgages was due to the mers system, bundling, cra, fanny and Freddy, wall street fraud, etc, not the deduction.
The current purpose is to extract every last penny out of your blood sweat and tears that they can get away with. The mortgage deduction elimination has a tidal wave of resistance, but it is a very nice looking plum, to use for more votes and favor financing.
I dont understand your question? People whose home has a mortgage can deduct the interest....maybe
People who own mortgaged property used for business (rental or other) can claim the interest as an expense
But yes, you could set up a corporation or a nonprofit foundation to own your home, Rahm Emmanuel did/does this as was determined from property tax records, surely many many sharp lawyers could help set up tax-advantaged shelters for your family home and income. Tax avoidance is how many of the real “rich” became rich and will stay rich
I just read that Ted Kennedy’s widow is “donating” his mansion on Cape Cod to become a nonprofit “retreat” - with lots of room for family vacations...err retreats....at any time, of course
So, not taxing something is a subsidy? Not taxing income twice is a subsidy?
Wait... what?
yes, they eliminate deductions and promise to reduce rates
then after the deductions are gone, they start raising the rates again
to cover the deficit in revenue that results from eliminating the deduction
So you would screw people who planned financially based on the rules in place when they bought their homes? Just so you can move forward and get your lower prices to buy it from them when they lose it? Sorry you sound like a typical shyster or at least a supporter of shysters.
You hit that right on the head! It is ALL about FUNDING OBAMACARE!!!!
Who the heck on average earns $180K a year????? Your example makes no sense. There are contracts IN PLACE...that people entered into based on the RULES IN PLAY! What the heck don’t you understand about that?
A true subsidy of mortgage interest would be if the feds used your taxes to pay for my interest, relieving me of the burden.
Maybe they should pass a law that banks cannot charge interest? A true subsidy, that, for the borrower anyway. LOL
the mortgage tax deduction also subsidizes rents by keeping the landlord costs down
if I can’t dedust interest, my costs of owning that rental house go up, as surely as the market will allow, I will raise the rent accordingly
a lot more people should be competing for rentals if there is less advantage to ownership other than psychological
or of course I could just sell my rental property, right now my property tax bill is double that of a residence next door, because owners get a homestead credit (another loophole to get rid of for owners who are indignant about govt subsidizing their homes)
I would enjoy screwing the city out of about $3000 a year in excess evil landlord property tax that owner-occupants do not pay
This is a familiar scenario. Certain deductions were eliminated when Reagan negotiated his tax legislation and then the RATS and RINOS reneged on the part where the rates were to be lower... during the Bush 1 admin and then again in the CLINTOON admin. The deductions that were given away of course still gone... their promise to keep the lower rate... well that’s history too! Bunch of crooks.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.