Monday, March 2, 2009

Mortgage deductions: Wealthy on the losing end




















By: Corey Mutterperl

NEW YORK (CNNMoney.com) -- The Obama administration hopes to tap the rich to help pay for its ambitious programs. Specifically, that would include slashing mortgage interest deductions for high-income taxpayers.

The proposal would cap at 28% the tax break for itemized deductions. That would leave people in higher marginal tax brackets of 33% and 35% - the wealthiest Americans - with a smaller benefit from the deduction of mortgage interest, state and local taxes and other items such as charitable contributions. The move is projected to raise $318 billion over 10 years and fits nicely with the president's campaign pledge to increase taxes only for families earning more than $250,000. Few, if any middle-income homeowners are in tax brackets of more than 28%.





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