BLACK FRIDAY GUIDE: Early Shopping Spots •  Hot Toys • Traffic Map • TV Buying Guide • Take A Free Hike

Mortgage Interest Deduction Might Be Cut

SAN FRANCISCO (KCBS) – The incoming Congress is expected to seriously consider ending a tax break that American homeowners have enjoyed for almost a century.

Since 1913, many Americans with mortgages have been able to deduct the interest, saving thousands of dollars a year in taxes.

The deduction makes home-buying more affordable. But is it time to phase out that deduction?

KCBS’ Doug Sovern Reports:

“Certainly, having people buy homes that they can’t afford to live in doesn’t make a lot of sense,” said UC Berkeley tax policy economist Alan Auerbach.

He said the new Republican-led House may replace the deduction with a tax credit, or simply eliminate it, which Auerbach said would be smart, economically.

“The way the tax benefit is structured, it just gives you a larger and larger benefit the bigger and bigger house you buy,” he said. “It also gives a bigger benefit to high income people.”

But Charles Moore, CEO of McGuire Real Estate in San Francisco, said changing it now would cripple the already reeling housing industry.

“Would it hurt the market? Yes it will, short term and long term. It’s the wrong time to do it, especially when we’re on life support as it is,” said Moore.

Realtors associations are launching a preemptive ad campaign to convince Congress to leave the deduction alone.

(© 2010 CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

  • bob

    Again something that will destroy the AMERICAN DREAM. If they do this only the wealthy will own property. They will turn most working class people into RENTERS. But that’s what they want. Maybe it’s time the Government looks into the way they spend money. They reward the government departments for spending money. If you don’t spend the money you don’t get as much to spend next year. Why don’t they reward them for not spending it all!

  • Mortgage Interest Deduction Might Be Cut « CBS San Francisco- News … | Mortgage

    […] here: Mortgage Interest Deduction Might Be Cut « CBS San Francisco- News … « 774K Homeowners Drop Out Of Obama's Mortgage-Aid Program « CBS Los … […]

  • Mortgage Interest Deduction Might Be Cut « Ben's Weblog

    […] here. Explore posts in the same categories: […]

  • Florida existing home sales slump in November

    […] Mortgage Interest Deduction Might Be Cut The incoming Congress is approaching to severely cruise finale a taxation mangle which American homeowners have enjoyed for roughly a century. Read some-more on CBS San Francisco […]

blog comments powered by Disqus
Guide To The Holidays
Shine A Light On The Holiday Season With ‘Giving Tuesday’

Listen Live