Dianna Johnston

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  Dianna commented on the article | almost 3 years ago

  Obama's Change.org: Citizen's Briefing Book

  Budget: Change mortgage interest deduction to tax credit.
  
  I recognize that there are good reasons to entirely eliminate the mortgage interest deduction but that's a political non-starter.  Thus, my proposal is more modest and is intended to bolster the President's proposal to limit the deduction to 28%.
  
  The idea of limiting the mortgage interest deduction of people in the top tax brackets is a fabulous step in the direction of making the tax structure fairer.  To counteract the opposition to it, I propose changing it from a tax deduction to a tax credit of approximately 28%.  Doing so would make the deduction much less regressive than it currently is while avoiding the argument that that the current proposal penalizes people in the higher brackets and constitutes "class warfare."  Converting the deduction to a credit and allowing everybody to get the same credit should have broad public appeal; i.e. it will be hard for the wealthy to argue that they should get more of a break on their taxes than a less wealthy person who is paying the same mortgage.
  
  The system could be made more progressive by limiting the credit to mortgages below a certain dollar figure, e.g. $750,000 or even $1,000,000.