In a recent article [1] by Ginger Gibson from Reuters [2], it was reported that the National Association of Homebuilders [3] (NAHB) has decided against demanding for a new version of the tax code that includes the mortgage interest deduction.
Though the NAHB has raised concerns in the past about the current proposals for tax reform which eliminate benefits such as the state and local tax deduction, nullifying the benefits of the mortgage interest deduction and caps to the MID, it is now considering other homeownership boosting alternatives—as long as it offers a homeowner tax credit.
“Now our policy is much more flexible,” Reuters reported Jerry Howard, President of NAHB saying. “It gives us a unique opportunity to help craft a unique tax policy as it is related to housing.”
President Donald Trump said that a tax code overhaul would be completed his first year in office, but according to the article, there currently is not a written proposal to create a homeownership tax credit to replace the mortgage interest deduction. The plan, or lack there of, is generating much opposition in the housing industry.
"[The National Association of Realtors [4]] supports the goals of simplification and structural improvements for the tax system, and individual tax rates should be as low as possible while still providing for a balanced fiscal policy,” Iona Harrison, Chair of NAR’s Federal Taxation Committee said in a statement during a Senate Finance Committee hearing. “We simply believe that to achieve these goals, Congress should commit first to doing no harm to the common interest that homeownership provides."
NAHB’s Howard, however, sees the plan as an opportunity to embrace creative alternatives and said that members of the tax code writing House of Representatives Ways and Means and Senate Finance committees have expressed interest in creating a homeownership credit.