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it may mean little if you can't clear the standard deduction by enough . most homeowners cannot itemize unless they are higher income earners according to irs records .
if you are to much of a high income earner than you lose your deduction for real estate taxes if the amt kicks in .
as time goes on and you pay less and less interest eventually cutting out all interest deductions more and more of the payment is on you .
tax wise it is the renter who benefits the most . they get to fly the empty seats . they may have very little money spent on itemized deductions . a couple can pay in 5 or 6k out of their piggy bank and write off over 12k . they actually get money back they never spent .
on the other hand there is a pretty good chance the homeowner actually pulled that dough out of their piggy bank and are not getting back anything they did not spend .
I also voted important. But I would buy without it. And the value of that deduction is dependent on other, unrelated personal and financial factors.
WHEN I was in a lower tax bracket with few other deductions to itemize, it was totally unimportant. In fact, when I owned my first home in my middle thirties, and owned my first business, there were years that the standard deduction exceeded my itemized deductions.
Early in my retirement, we had cash available that wasn't tied up in tax sheltered IRA'so. We used it to pay off the mortgage. (Lost that money big time when we sold in 2012. Would have been better off with the mortgage and a short sale.)
Now, our money is tied up in IRA'so and earning more tax free than our 3.5% mortgage. As the RMD increases and forces us to take distributions beyond what we need, we'll consider paying off the mortgage.
It won't stop me from buying a house, but I'm sure a lot of people would. It's nice to get a deduction. But my loan is pretty low percentage, I pay basically two extra payments a year to principal.
I think it's a WAY overhyped "bonus". Personally I rather get a lower sale price. This is better IMO. A lower payment allows you to keep some of your money that would otherwise go for shelter costs to spend or invest. You have lower property taxes, and the down would be lower.
If you take a ,Ortega get out, the deduction effectively changes your take home pay. While I would purchase without it, I might purchase less without it.
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