Is Getting Rid Of The Mortgage Interest Deduction A Good Idea?
With the approach of the 2020 election, the talk about the current tax code will start to pick up. Like every election before it and probably every election after it, the 2020 election will feature taxes in some form. One of the most accessible parts of the tax code to change would be the mortgage interest tax deduction. If the deduction was eliminated, then other rates could be lowered.
The reasons behind the deduction
The reasoning behind the mortgage tax deduction is very much rooted in our history, where owning a home was seen a great investment. To help prospective buyers out in a way, the deduction was introduced to save middle-class and upper-class homeowners a good chunk of change. To replace the tax deduction, the IRS could impose lower tax
In the years leading up to the 2008 financial crisis, there was a growing segment of the real estate investors that focused solely on undervalued properties. This style of investing is best summed up in the phrase, “Buy the worst house in the best neighborhood.” The investors then would renovate the home, or flip the house, and sell the property for a profit.