I get the frustration of the author on grandfathering in mortgages for interest deduction, and you could certainly argue it’s for the benefit of boomers at the expense of millennials, but isn’t it the only sane option? Otherwise the tax bill could effectively be putting people with existing mortgages (not an easy thing to get out of) in a serious bind. It kind of seems a bit unfair.
Though I will admit after writing that out, that it’s probably not really that different than other taxes - if you plan your financial life around a certain tax situation you have to understand it could always change.
The overall lower tax rates are the biggest hand out to the boomers. They’re the ones with retirement accounts that only now begin to draw down at the lower overall rates.
It’s fine to say that people shouldn’t plan around tax situations, but that tax break has been thought to be untouchable for a long time now. I’m a millennial who bought last year so for me, this doesn’t sound very fair. Boomers got to take advantage of favorable tax write offs on their homes for decades; I’ll be able to get in on that for 2 years. 2.
The mortgage interest deduction is bad. Economists are almost universal in their agreement on this topic. Sure it sucks that some people got to take advantage of a bad thing in the past, but that isn't a good argument for keeping it around just for the sake of generational fairness.
That’s just one facet, I don’t think that’s the only reason to keep it around. I think it’s irresponsible economics to encourage an economic behavior and then to uproot it abruptly. I think the knock on effects on the housing market and rental markets haven’t been appropriately priced in. I think there’s a lot of ways for this to go sideways and the payoff isn’t that great.
Couple that to the estate tax changes which are not an economic driver and help to curb wealth inequalities and I think it’s a raw deal.
you are, but the removal of the state & local income tax deduction means only a small % of people will ever claim mortgage deductions compared to today. You’d need over 24K in mortgage interest + property taxes.
Though I will admit after writing that out, that it’s probably not really that different than other taxes - if you plan your financial life around a certain tax situation you have to understand it could always change.