Obama Budget to Limit Mortgage Interest Deduction, Change Capital Gains
The National Association of Realtors® is reacting negatively to President Obama’s proposed budget for 2013, which would eliminate some favorable tax benefits for property owners and investors.
NAR believes that the mortgage interest deduction is vital to the stability of the American housing market and economy. “We urge the president and Congress to do no harm,” says a spokesperson for the association.
NAR points out that while progress has been made in bringing stability to the housing market, the recovery has been slow. The nations homeowners already pay 80 to 90 percent of U.S. federal income taxes. The association fears that raising taxes on that group, now or in the future, could critically erode home values at all price levels. “This would destroy middle-class wealth accumulation and trillions of dollars in home values nationwide.”
NAR also strongly opposes eliminating capital gains treatment for any carried interest of a real estate investment partnership. The loss of capital gains treatment for income from a carried interest could disrupt the conventional business model and places an unfair tax burden on general partners “ ultimately this would negatively impact commercial real estate investment, according to NAR.
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