TIPS HELP MAKE FOR A SAFER HOME IN WINTER

Though astronomical winter doesn't start for almost another three weeks, meteorological winter has already arrived in St. Louis. Here are a couple of good resources for you to help make sure you and your home are ready for the worst that Old Man Winter can dish out. (Source: Home Safety Council)

Go to the tips.

Mortgage deduction could vanish

Tax advisors to President Bush recently advised him to work with Congress to remove the mortgage interest deduction. Noting that the deduction benefits wealthy taxpayers more than those struggling to buy a home, the advisors angered members of the National Association of Realtors who believe that the act could reduce home values by upwards of 15%.



That most sacred of tax breaks, the mortgage interest deduction, could vanish if President George W. Bush and Congress follow the recommendations of his tax advisory board.

Nine tax experts, handed the task with developing simpler and fairer tax laws, concluded that the deduction does more for wealthier taxpayers than for people struggling to buy a home. But mortgage bankers and real estate agents see irreparable harm if the tax break disappears.

The National Association of Realtors estimated that housing prices could decline 15 percent, bad news for owners who have seen the value of their homes increase.

"You're going to be taking away from Middle America," said David Lereah, the association's chief economist. "Everyone, whether you use the mortgage interest deduction or not, the value goes down."

The current tax break lets homeowners deduct interest paid during the year on a mortgage up to $1 million and a home equity loan worth up to $100,000.

Almost 36 million taxpayers claimed the deduction in 2003, according to the most recent statistics compiled by the Internal Revenue Service.

The President's Advisory Panel on Federal Tax Reform urged the administration to do away with the deduction and replace it with a credit worth 15 percent of interest paid during the year. They would scrap the deduction for property taxes, too.

Mortgages eligible for the tax break would be limited by a formula reflecting the average regional price of housing.

Connie Mack, a former senator from Florida and chairman of the tax panel, said less than 5 percent of mortgages in the nation exceed the proposed cap.

Mortgage deduction could vanish
By Mary Dalrymple
THE ASSOCIATED PRESS
11/05/2005

WASHINGTON