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Property Tax Break's Days Could be Numbered

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    All it seems this month it is taxes this, and taxes that. Which is understandable. Property tax breaks could be on the chopping block according to some GOP proposed tax plans, which could eliminate it and other tax breaks altogether. To remind us of the sheer advantages and disadvantages of the Property tax, I found a decent article with the breakdown. According to the first article:

    Nearly 35 million families deducted their taxes on their home or other real estate from their federal taxable income in 2016. They saved a total of $33 billion.

    If property tax breaks were to go the way of the Dodo, how much of an impact would this have on the majority of Americans, come tax season? I suppose, we should ponder the statistics of who owns vs rents property etc. Thoughts?

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    Loaded question, I think. Depends a lot on what they plan to replace the break with. If they just cut the tax break and did nothing else to the tax rules/code, then it would definitely hurt everyone. But if they raise some deductions here, cut some tax breaks there.. it will have to all be added up, and be different for everyone.

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    The property tax deduction and the mortgage interest deduction have had an undetermined impact on the pricing of housing. The American home is now marketed as a dual purpose residence and tax shelter. One wonders if housing would be less expensive if the "tax shelter" component had never existed and by how much. 5%? 10%? $33 billion in tax savings by 35 million people means an average savings of less than $1,000. Given that rising house prices (along with rising student debt, medical coverage etc) are making it harder for young families to afford homes I doubt that our society has benefited from these tax deductions. I also doubt that the effect can be easily undone.
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    RALFocus Wrote: The property tax deduction and the mortgage interest deduction have had an undetermined impact on the pricing of housing. The American home is now marketed as a dual purpose residence and tax shelter. One wonders if housing would be less expensive if the "tax shelter" component had never existed and by how much. 5%? 10%? $33 billion in tax savings by 35 million people means an average savings of less than $1,000. Given that rising house prices (along with rising student debt, medical coverage etc) are making it harder for young families to afford homes I doubt that our society has benefited from these tax deductions. I also doubt that the effect can be easily undone.

    Good point. Tax breaks on taxable goods, property and services all face this issue. Haven't really thought to seriously about that, but I should going forward.

    Makes a lot of sense that if whatever industry that has the consumer getting a tax break on their goods/services can then, at least in some cases, artificially inflate that market by slowly raising prices because of said tax break... damn. Obviously this is what happened in large part with student loans and healthcare. But I never really made the connection with other industries.

    If I am understanding your point correctly, that is.