Washington— NLBMDA urges its members to take action by contacting their Representative and Senators and asking them to preserve the mortgage interest deduction and its critical role in American housing policy. As tax reform discussions pick up in Washington, the preservation of this tax incentive is important to the continued strength and growth in residential construction.
The mortgage interest deduction has been part of the tax code since its inception in 1913 and is the cornerstone of American housing policy. Homeowners do not expect to lose their mortgage interest deduction, and prospective buyers anticipate taking the deduction. Changing “the rules of the game” would have a significant impact on the housing market in terms of owner and buyer behavior.
Eliminating the mortgage interest deduction would have a negative impact on housing: after-tax housing costs would increase and demand for housing would decrease. In turn, reduced demand would depress home prices, producing a sizable loss for existing homeowners that would have a drag on the economy.
The mortgage interest deduction helps make the tax code more progressive and primarily benefits middle class taxpayers. Data from the Congressional Joint Committee on Taxation shows that 82% of households who benefit from the mortgage interest deduction have incomes of less than $200,000.
NLBMDA opposes any proposal reducing or eliminating the mortgage interest deduction as part of comprehensive tax reform. The consequences would be devastating for homeowners, the housing market and the nation’s economy.
Please take action by contacting your lawmakers and asking them to preserve the mortgage interest deduction.