Talk:Home mortgage interest deduction

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I've heard that Australia allows a deduction on the initial down payment but not the interest. In effect subsidizing the saving but not the borrowing. Which is not a very POV way to put it I'll admit but I can't find a site. —Preceding unsigned comment added by 205.153.36.171 (talk) 15:14, 30 September 2008 (UTC)

Tax advantage

I removed the term "huge" regarding the tax advantage. It seemed POV and relative. I recently read a Tax Policy article here that states the MID does not have a substantial impact on homeownership and linked to why the mortgage interest deduction is bad tax policy (see toward the bottom of the article). Perhaps some of this can be included. Morphh ^(talk) 17:33, 02 January 2008 (UTC)

Yeah, my understanding is that academics and tax experts hate this deduction (unless the country taxes imputed income on home ownership), and there are plenty of sources to back this up. I'll be adding stuff about this. Fireplace (talk) 21:21, 3 January 2008 (UTC)

Actually though they hate this deduction, it is the second most hated tax distortion from ideal income taxation; the biggest distortion is the exclusion from the tax base of the imputed rental income on owner occupied residential realty. Hammer of the year (talk) 03:37, 30 December 2008 (UTC)

Netherlands

The article that all interest payments can be deducted completely. This is untrue. In the Netherlands there is what is called the 'eigenwoningforfait'. The tax authorities reckon that if you didn't own a house you would have to pay rent. Because you own the house and can deduct the interest, they consider this an advantage and count it as income. For houses valued at € 75,000 and up, 0.55% of the value (with a maximum of € 9,300) is considered income. From January 2009, there is no maximum.

Further, the article states that the deduction reduces the real interest to zero or less. The maximum tax rate in the Netherlands is 52%. Even at the highest income, the interest will only be reduced by 52%.

The statement that due to this effect the prices of homes in the Netherlands will continue to rise forever is purely an opinion. In fact housing prices in the Netherlands appear to be currently on the decline. —Preceding unsigned comment added by Pingu232 (talk • contribs) 18:09, 16 February 2009 (UTC)

Home equity Canada/US

There was a line about how home equity in Canada was much higher than in the US in 2008. Likely true: Canadian home prices were booming and US prices crashing at the time. What this has to do with tax policy is unclear, so I've removed the statement.Bhudson (talk) 04:06, 3 October 2012 (UTC)

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Still no examples of anyone with misconception about deduction

We now have several sources saying there is a "popular belief" that Congress created the mortgage interest deduction in 1913 with the intent of encouraging home ownership. When you read each of the sources, they all seem to be of the "well, actually..." variety, where the author is arguing a case about the deduction, and intends to demonstrate that those who defend it are misinformed. It serves their cause to accuse them of holding a false belief about the intent of the original law. Yet they never once name an actual individual who espouses this false belief. The Ventry source recounts the history in detail, showing by the 1950s, there was a growing tax reform momentum against the deduction, for a variety of reasons, but that failed and instead Congress added more loopholes favoring home owners in the 1950s and 1960s. It was during this period that the idea became widespread that the deduction helped home owners. Some argued it was regressive and served only the rich, but the opposite view gained political support. Ventry chronicles this on through the 80s, when Reagan pledged to defend it as a pillar of the middle class, up through Trump, who made a similar pledge, right up until he didn't.

Nobody seems mislead as to what the original intent of the law was. Those who came to value it in the postwar years argued that at that time it had come to be a benefit for a wider and wider number of people, as inflation made the 1913 cutoffs, originally only in the realm of wealthy home owners, more and more in the price range of middle class homes. The effect of a law triggered at a set dollar value is obviously going to change over a long span of time, due to inflation. Political factions don't all agree on the question of whether or not the tax break was regressive or not, but the idea that one side is ignorant of the law's history appears to be politically motivated straw man rhetoric.

Can we identify anyone, by name, who ever went on record saying they believed this supposed "popular misconception"? --Dennis Bratland (talk) 06:36, 22 January 2018 (UTC)

@Dennis Bratland That's a ridiculous question. One person believing something doesn't mean many people do. Anecdotes do not make data.

I understand your issue with the references, because both support eliminating the deduction...so a reference that supports KEEPING the deduction, but also mentions the same misconception would in your opinion add credibility here, if I can find one..? I'll try to find one, and update this if/when I do. Avatar317 (talk) 21:27, 22 January 2018 (UTC)Avatar317