Camp's plan would have shrunk marginal rates for most taxpayers to just two brackets, 10 percent and 25 percent; phased down mortgage interest deductions
from the current $1 million limit on eligible mortgage amounts to $500,000; eliminated deductions on home equity loans and credit lines altogether; and stretched out the time period needed to qualify for tax-free capital gains exclusions from the present two years out of the preceding five years to five years out of the preceding eight years.
You can also prepay your January mortgage payments to capture any mortgage interest deductions
Moreover, mortgage interest deductions
may vary from loan to loan.
pdf) a study by The Wharton School at the University of Pennsylvania, if the mortgage interest deductions
were eliminated completely, the average household's annual tax bill would increase by a little more than $1,000.
EQUITABLE OWNERSHIP AND MORTGAGE INTEREST DEDUCTIONS
* REPORTING SPECIFIED FOREIGN FINANCIAL ASSETS * LB&I EXAM CHANGES
Congress also asked us to provide descriptive information on taxpayers' mortgage interest deductions
and mortgage interest payments reported on Form 1098, Mortgage Interest Statement.
One proposal would convert real property and mortgage interest deductions
into a credit which would begin to be phased out when income on a joint return reaches $50,000.
According to the FTB, audits of tax returns with large home mortgage interest deductions
indicate that many taxpayers and tax practitioners are not complying with the rules regarding debt limitations on the deductibility of home mortgage interest.
You might get an extra month's worth of mortgage interest deductions
for 2006 by making your January payment in December," says Sidney Kess, an attorney and CPA in New York.
And, nearly half of the 8 million middle-income taxpayers take state and local tax deductions or mortgage interest deductions
Other options the panel is mulling include significantly reducing the $1 million cap on mortgage interest deductions
and eliminating federal deductions for state and local taxes, Breaux said.
Homeownership is the biggest single ticket item--$111 billion a year, topped by $70 billion for mortgage interest deductions
, $22 billion for property tax deductions and $18 billion for capital gain exclusions on the sale of primary, residences.