Also you've pointed out mortgage interest deduction - what about property tax deduction? The memo says "protect home ownership...deductions". Removing the property tax deduction would be a huge tax hike.
If it is true that trump is doubling the amount of the standard deduction, then in most cases for middle class citizens, it would be worthless/unnecessary for tax payers to itemize their deductions.
The way tax law works, is that you only itemize deductions, if you can prove that it is more (higher) than the standard deduction that you can take.
So if the new standard deduction is double the amount it use to be, and if itemized deductions are reduced to just two "items" (mortgage interest and chartable contributions), then for most Americans, taxes will be filed using the standard deduction.
Only the few (mainly the RICH AND WEATTHY) who buy very large homes or mansions, would actually itemize their deductions. Some middle class citizens might itemize the first 3-5 years or so, since their monthly mortgage payments are mainly interest in the early years of their mortgage (home loan), but I assure you this is not a significant amount of "normal" people.
That's nice.
I currently fall in the 25% bracket. I took $20,000 in deductions last year. They were fairly evenly split between mortgage interest, property tax, and charitable giving. Deleting the property tax deduction puts me roughly at the standard deduction assuming I contribute the same amount to charity. And my tax bracket won't change. So, this is a tax hike for me.
And no, interest isn't huge "just in the very beginning." Interest makes up more than half for the first, well, half of your mortgage's life.
All that to say this removes an incentive to home ownership that I can only see causing less demand and falling house prices.
Stupid. (Not you
)
