The tax legislation working its way through Congress would only slightly lower home values and could boost homeownership, according to a new analysis from the White House that addresses fears that the elimination of the mortgage interest deduction could create a large disincentive for homeowners.
The White House Council of Economic Advisers paper found that the House tax bill’s treatment of the mortgage deduction would result mostly in simplification. The number of people taking the simple standard deduction, rather than itemizing specific deductions, would increase from 74 percent to 92 percent, and the study said there would be a very small impact on home prices.
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