Reply #2: how much difference do you think it makes? [View All]

[orangeapple]

"As explained by the IRS, how much interest you deduct depends on the date the mortgage was taken out and the amount of the mortgage. If your loan was taken out before Oct. 13, 1987, there are no limits on the amount of interest that can be deducted. If it was taken out after that date, you cannot claim interest on more than $1,000,000 worth of mortgages on first and second homes, nor more than $100,000 in any loan taken out for any reason other than home purchase. Layered on the mortgage interest rules are the itemized-deduction limitations. Mortgage interest is one of many itemized deductions. In 2009, your deduction for certain types of itemized deductions, including mortgage interest, begins to phase out at an adjusted gross income of $166,800. For every $100 of income over the limit you lose $3 of itemized deduction up to a maximum loss of 80 percent of your itemized deductions."


For a person with a $1,000,000 mortgage and a 7% rate you're talking about a ~$2,000 deduction, before even considering the phase out for income over $166K. How many million dollar mortgages do you think are out there? It's not enough to address trillion dollar annual deficits.