Limiting the homeowner mortgage interest deduction came up in two of the presidential debates, but specifics about who would be affected and how much they might lose in tax benefits were minimal. To put some rough numbers on the issue, here’s a quick primer on the mortgage interest deduction and related housing write-offs.
How big are they? Very big, which is why they have become such a tempting revenue-raising target for candidates seeking to reduce the massive federal deficit. According to estimates from the congressional Joint Committee on Taxation, the mortgage interest deduction alone will “cost” the federal government $484.1 billion between fiscal 2010 and 2014 — $98.5 billion in 2013 and $106.8 billion in 2014. Write-offs by homeowners of local and state property taxes account for another $120.9 billion during the same five-year period. [more]