[quote=outtamojo][quote=FormerSanDiegan]I also disagree with the thesis that eliminaiton of the mortgage interest deduction would result in increased tax revenue for Government.
There’s no way they would reap the $100 Billion claimed (see #1 below). I think there can lso be an argument made that the end result might even result in a loss in revenue to state & local governments equal to or larger than the $100 billion
Here’s why:
1. People respond to changes in tax code. I, for example would rent out my primary and move into a rental. The mortgage interest I currently pay would turn into a business expense.
2. Elimination in MID would put downward pressure on home prices. In the long-run property prices will be lower than they would have been if the MID were in effect, resulting in decreased property tax revenues to local/state governments.[/quote]
Excellent idea that #1. My MIL lives next door with same floor plan- we could swap houses. Better yet, why bother doing that and just write up a rental contract while staying in the same house- who’s to know eh?[/quote]
Better yet, you can create rental contracts for rent below market value. Then you can write off the “losses”. In essence, you’ll have something similar to MID.
