Just as the housing market begins to recover the politicians in Washington stand ready to strike a blow to the housing recovery by eliminating the popular mortgage interest deduction. As it stands now taxpayers are able to deduct a significant portion of interest paid on their home on their taxes. While in most cases this is not the sole basis for a decision to buy a home it is an added encouragement for a person who is thinking about purchasing a home.
By now you have heard of the fiscal cliff. In the discussions about preventing the country from falling of the fiscal cliff politicians have indicated that the mortgage interest rate deduction is “on the table.” While no doubt deductions need to be trimmed and loopholes closed and spending reigned in, doing away with this popular deduction runs smack in the face of efforts by our government to help the housing market. Of all the less than helpful things the government does in an effort to help the housing sector, this is one good thing the government does and it should be kept. Be sure to let your representatives and senators know that they need to keep this deduction and keep the housing recovery moving in the right direction.