Pages

Jump to bottom

4 comments

1 lostlakehiker  Tue, Nov 27, 2012 8:48:12am

People who bought houses acted in reliance on the government's more-or-less promise that mortgage interest would be deductible. Same as people making retirement plans acted in reliance on another governmental more-or-less promise.

In neither case is the government bound by law to follow through. In both cases, changing the rules now would leave millions of people in situations that will go on for decades, playing out worse than they expected, and stuck with a situation they could not have planned for.

Perhaps there is no way around this kind of governmental default. But let's not play make-believe. Any adverse change to either of these provisions of the current law will be one that runs into the same "fairness objection".

In neither case does any serious player propose to make a change that works against the poor or the near poor, or even the next couple of rungs up. Social security benefit reductions would apply to the fairly well off and not to others, and canceling home mortgage interest deductions would not affect the mass of people who have too few deductions to itemize anyhow. It would not much affect those who have only barely enough deductions to itemize.

2 Randall Gross  Tue, Nov 27, 2012 9:42:56am

re: #1 lostlakehiker

You don't need to do either if you just raise the tax rates on the uber rich to a reasonable rate.

3 sagehen  Tue, Nov 27, 2012 11:48:54am

If they phase out the mortgage interest deduction -- 4 years phasing down for things other than primary residence, then ten years of 10%/yr to get rid of on primary residence...

that won't be a problem for any current homeowner. By that time, your payments are mostly principle.

It will reduce the asking price when you want to sell the place, but I see that as a feature, not a bug. Half the reason for the bubble (and a big part of why housing is so unaffordable now) is that low-income and middle-income people are subsidizing upper-income people's homes.

4 lawhawk  Tue, Nov 27, 2012 1:14:19pm

re: #1 lostlakehiker

Tax rates and all other aspects of the tax code are not immutable. There's no guarantee that rates will remain constant, that other aspects of the Code are never to change and that people will make decisions based on what is at hand. And as historical tax rate changes (among other things) have shown is that the only real constant is that the Code is constantly tinkered with.

There have been several iterations of the Code - 1954 and 1986 being major overhauls. In between there have been significant changes, including the 2001, 2003 and 2009 tax acts that changed rates and adjusted a whole host of tax issues (NOLs, capital gains, etc.).

Adjusting the MID could be done with minimal impact to middle class if you reduce its availability as a percentage of income. For instance, you could start out with a MID adjustment as follows: if you're in the 25% bracket, you'd get 100% of the MID; 90% if you're in the 28%; 80% if you're in the 33%; and 70% in the 35% bracket.

You could then reduce the percentages over time available to the high tax brackets.

Alternatively, one could give the AMT more teeth by essentially eliminating all deductions for high income earners, including on the MID and rolling it back into the basic tax code at a new bracket point (no separate calculations - one simply determines their income without the deductions/credits available to lower bracket taxpayers).


This page has been archived.
Comments are closed.

Jump to top

Create a PageThis is the LGF Pages posting bookmarklet. To use it, drag this button to your browser's bookmark bar, and title it 'LGF Pages' (or whatever you like). Then browse to a site you want to post, select some text on the page to use for a quote, click the bookmarklet, and the Pages posting window will appear with the title, text, and any embedded video or audio files already filled in, ready to go.
Or... you can just click this button to open the Pages posting window right away.
Last updated: 2016-01-01 10:29 am PST
LGF User's Guide RSS Feeds

Help support Little Green Footballs!

Subscribe now for ad-free access!Register and sign in to a free LGF account before subscribing, and your ad-free access will be automatically enabled.

Recent PagesClick to refresh
Cass McCombs - ‘Run Sister Run’"Run Sister Run" by Cass McCombs from the album 'Mangy Love,' available 8/26Pre-order here: lnk.to Official Site: cassmccombs.comFacebook: facebook.comTwitter: twitter.com
Thanos
18 hours, 27 minutes ago
Views: 187 • Comments: 0 • Rating: 0
Tweets: 1 • Share to Facebook
Shares: 0
Likes: 0
Comments: 0
: 0
The ‘Internet of Things’ Needs a Fix Lack of standards, lack of security, and application creep all create inertia against easy adoption. The first moments of ownership usually involve downloading an app, creating an account and connecting the thing to your Wi-Fi network. Sometimes that all ...
Thanos
20 hours, 6 minutes ago
Views: 224 • Comments: 0 • Rating: 1
Tweets: 1 • Share to Facebook
Shares: 0
Likes: 0
Comments: 0
: 0
North America Will Draw Half Its Electricity From Carbon-Free Sources by 2025 - Scientific American The United States, Mexico and Canada will make a joint pledge tomorrow to draw half the continent’s power from non-emitting sources by 2025. President Obama, President Enrique Peña Nieto of Mexico and Prime Minister Justin Trudeau of Canada will ...
Thanos
20 hours, 12 minutes ago
Views: 216 • Comments: 0 • Rating: 1
Tweets: 1 • Share to Facebook
Shares: 0
Likes: 0
Comments: 0
: 0
Egypt Deports Liliane Daoud, British-Lebanese Talkshow Host Ms Daoud, a former BBC journalist, was detained by plainclothes policemen at her home in Cairo on Monday and put on a plane to Beirut. The move came hours after her contract was terminated by privately-owned OnTV. Her show, ...
Thanos
20 hours, 13 minutes ago
Views: 230 • Comments: 0 • Rating: 1
Tweets: 1 • Share to Facebook
Shares: 0
Likes: 0
Comments: 0
: 0
Google Maps and Earth Just Got a Huge Boost The new techniques for processing the images will ensure that the pictures have more clarity and have a higher resolution. How did Google go about bringing clearer images users' way? Google deployed the publicly available Earth Engine API to ...
Thanos
1 day ago
Views: 307 • Comments: 0 • Rating: 2
Tweets: 27 • Share to Facebook
Shares: 1
Likes: 0
Comments: 0
: 1
NASA Studies Details of a Greening Arctic NASA scientists used almost 30 years of data from the NASA/U.S. Geological Survey Landsat satellites to track changes in vegetation in Alaska and Canada. Of the more than 4 million square miles, 30 percent had increases in vegetation (greening) ...
Thanos
1 day, 12 hours ago
Views: 301 • Comments: 0 • Rating: 0
Tweets: 12 • Share to Facebook
Shares: 3
Likes: 1
Comments: 0
: 4
Don’t Let Mississippi Establish Anti-Gay Religion The federal law and its many state imitators apply equally to all sincere religious believers and their beliefs. The Mississippi statute doesn't. It begins by singling out three religious beliefs or moral convictions for protection. They are that “marriage ...
Thanos
1 day, 21 hours ago
Views: 548 • Comments: 1 • Rating: 2
Tweets: 44 • Share to Facebook
Shares: 1
Likes: 1
Comments: 0
: 2
Brexit in Brussels: Juncker’s Mic Drop and Political Brexploitation The three presidents—Juncker along with Donald Tusk, who heads the European Council, and Martin Schulz, the president of the European Parliament—said they “expect the United Kingdom government to give effect to this decision of the British people as soon ...
Thanos
2 days, 22 hours ago
Views: 673 • Comments: 0 • Rating: 2
Tweets: 6 • Share to Facebook
Shares: 1
Likes: 0
Comments: 0
: 1
Brexit: EU Spells Out Procedure for UK to Leave The European Union has clarified the way the UK can kickstart formal negotiations to exit the bloc following Thursday's referendum. It says Britain can trigger Article 50, which sets a two-year deadline for a deal, by making a formal ...
Thanos
3 days ago
Views: 491 • Comments: 0 • Rating: 0
Tweets: 2 • Share to Facebook
Shares: 1
Likes: 0
Comments: 0
: 1
With Donald Trump in Scotland, Hillary Clinton Rails Against His ‘Brexit’ Response Asked about Britain's plummeting currency in a part of the nation which had voted overwhelmingly to stay in the E.U., Trump noted a money-making opportunity: You know, when the pound goes down, more people are coming to Turnberry, frankly. ...
Thanos
3 days ago
Views: 391 • Comments: 0 • Rating: 1
Tweets: 0 • Share to Facebook
Shares: 0
Likes: 0
Comments: 0
: 0