Mortgage Interest Deduction

For the record, I support Obama’s plan to reduce the mortgage interest deduction for the wealthy:

As the part of the new budget, the personal itemized deduction phaseout would be re-instated for high-earning individuals.  The phaseout is pretty complex, and essentially means that itemized deductions are phased-out at higher income levels.  (I am not a tax expert and don’t want to get bogged down in tax talk.  Here is a pretty good article by Mary Gallagher that explains the issue in more depth if you are interested in further information).  The takeaway is that homeowners with mortgages that make over $250,000 as a household, or $200,000 as an individual would see their mortgage interest deductions decreased under the plan.

Does this make me anti-rich? On the contrary, since I support the complete elimination of the mortgage interest deduction for everybody – rich and poor. It is simply bad economics that economists from both sides agree should be removed. See here for a good primer on why.