For those who didn't already know, if you own two houses, you can deduct the amount you pay in mortgage interest on both of them. Even if one of them is a houseboat. In fact, a house needs a few necessities like a toilet, and it qualifies to deduct the interest.
Why in the hell is that? I mean, besides that these rules were written by Congress and many Congressmen have two homes. Besides that, why is that a law? I understand what most tax code is for. I really do. And too much of it is devoted to closing unintended loopholes crafted by crafty accountants and lawyers, which trip up the innocent taxpayer more than the greedy ones. But this two-home mortgage deduction is just too much. I don't know how much revenue is lost due to this deduction, but it really should be stopped. Especially as it allows people to write-off interset paid on a houseboat.
BTW, this does not refer to people who buy homes for investment or rental purposes. That interest would be deductible as a business expense. This only applies to people who own two homes for personal use. And anyone who can afford two houses doesn't need the extra deduction. If Congressmen want a deduction for their second house, they need to try to pass that bill and see how far it gets. But we really should stop subsidizing second homes for the rich.
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2 comments:
Great blog, Doc.
But in defense of this many middle class families where I grew up in MN have lake front cabins (I know it sounds all houghty toughty but in a state with over 10,000 lakes lakefront property isn't all that expensive)
Of course most, like my parents, needed a mortgage to buy the cabin but a bare bones one can usually be had for under $120k.
In fact, a house needs a few necessities like a toilet, and it qualifies to deduct the interest.
One other thing, my parent's cabin minght not even qualify because all it had was an outhouse, however.
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