Mortgage interest deduction
A tax provision allowing homeowners to deduct mortgage interest payments, reducing their taxable income. Despite being justified as promoting middle-class homeownership, this $30+ billion annual subsidy primarily benefits wealthy homeowners in expensive markets, exemplifying the 'upside-down' welfare state.
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Related Terms
Tax expenditure
Revenue the government forgoes through tax breaks, functioni...
Upside-down subsidy
A tax expenditure that provides larger benefits to higher-in...
Itemized deduction
Individual deductions that can be claimed instead of the sta...
SALT (State and Local Taxes)
State and local income taxes, sales taxes, and property taxe...
Points (mortgage)
Prepaid interest paid at closing to reduce the mortgage inte...