Report: Mortgage Interest Deduction Promotes InequalityBy Liz Dominguez
Among the repercussions the tax overhaul proposal can have on the mortgage interest deduction, the National Low Income Housing Coalition (NLIHC) and the Institute on Assets and Social Policy (IASP) at Brandeis University's Heller School recently released a report, "Misdirected Investments: How the Mortgage Interest Deduction Drives Inequality and the Racial Wealth Gap." The report states that the mortgage interest deduction exacerbates racial inequality and widens the racial wealth gap by distributing the annual $71 billion federal disbursement to primarily white, high-income homeowners.
According to the report, 84 percent of the deduction benefits go to households with more than $100,000 in income (about $55 billion annually), and 64 percent go to those with over $200,000. The report shows this also plays a role in the racial wealth gap, as most households (67 percent) are white and are more likely to be in a high-income bracket compared to black and Latino households. Here's a breakdown of the benefits by race:
These institutions are calling for reform of the mortgage interest deduction in a way that redirects the U.S. housing budget towards renter benefits and better housing security. The NLIHC and the IASP propose:
Source: National Low Income Housing Coalition (NLIHC) Liz Dominguez is RISMedia's associate content editor. Email her your real estate news ideas at ldominguez@rismedia.com. |
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