Mortgage interest deduction on chopping block

[StormRichards]

Anyone losing sleep over this? Personally, I have never viewed it as much of a difference maker in my overall finances.

Heads up homeowners: Mortgage interest deduction on Trump’s chopping block

http://www.cnbc.com/2016/12/01/heads-up-homeowners-mortgage-interest-deduction-on-trumps-chopping-block.html

[Thrif-t]

Unless I read it wrong, sounds like the standard deduction is going to go up.

That should take the place of the mortgage interest for those who no longer have it and people who don't have mortgages will get the benefit of a higher deduction

[bzbee]

We take standard deduction because its way higher than we pay in interest and taxes on our house now. We paid it down to 90k now, so not that much is wasted on interest any more.

[disneysteve]

Our mortgage balance is down to about 36K so the deduction is pretty minimal at this point.

[Singuy]

This may hurt house sales (especially in HCOLA) so even though the math may not make a difference for the majority of Americans, interest rate deduction can no longer be used as a sales tactic.

Also home buyers are very confused about interest rate deductions. I know many willing to keep a mortgage because it's "good for my tax return". So even though the actual bill may not hurt anyone, the fact that it's "chopped" gives confused home buyers the impression now that buying a house is no longer "good for my tax return".

[kork13]

That would be unfortunate. I have almost never taken the standard deduction, because charitable contributions always took me well above the standard deduction. If this goes into effect, it'd be a pretty significant hit for us. We'd lose thousands of dollars, because taking the standard deduction (under current tax structure) will basically never be advantageous to us.

[Jluke]

I read this article before it was posted here and thought it said capped at $100,000 for the interest deduction? Whether that is cumulative or yearly I wasn't sure but if I remember correctly the mortgage example they gave was 500k only having 23k in interest (one year).

Like Singuy said it won't affect too many people, unless they are just planning ahead and foreshadowing a higher interest rate environment.

[phantom]

The change proposed in the article wouldn't impact me directly since, as of our most recent mortgage payment, we're down to less than $100,000 left on our mortgage. Even if the mortgage interest deduction disappeared entirely, I couldn't be too sad since I recognize that my family, like most who can actually use the deduction, doesn't really need it. In fact, I think I'd rather see it just disappear, simplifying the tax code, than see an extra cap, complicating the tax code.

[LivingAlmostLarge]

I use it. But for many people most don't. Mostly it's in HCOLA and people who make money. People who are living on investments probably don't get as much benefit as those making $200k+ and high mortgages.