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The government is very good at filtering that money through processes and contractors that extract as much of it as possible. The main benefit of reducing the s
by pessimizer 4y ago
The government is very good at filtering that money through processes and contractors that extract as much of it as possible. The main benefit of reducing the safety net to a basic income is the elimination of a massive amount of administrative overhead.
As a random example of subsidy of the wealthy, every year, the government loses at least $70B to just the mortgage interest deduction, which is allowed for the first $750K of the value of up to two homes. That is $2,160 for every poor person in America, or $6,480 per poor family of three.
edit:
> Little of the deduction’s benefits go to households that have difficulty affording a home. Data from the Census Bureau’s American Housing Survey show that in 2011, 10.5 million homeowners faced what HUD calls “severe housing cost burdens,” meaning they paid more than half of their income for housing. Some 90 percent of those homeowners (and about 40 percent of all homeowners) had incomes below $50,000, yet JCT estimates for 2012 show that homeowners with incomes below that level received only 3 percent of the benefits from the mortgage interest deduction.
At the same time, 77 percent of the benefits from the mortgage interest deduction went to homeowners with incomes above $100,000, almost none of whom face severe housing cost burdens. Some 35 percent of the benefits went to homeowners with incomes above $200,000; taxpayers in this income group who claimed the deduction received an average subsidy of about $5,000.
https://www.cbpp.org/research/mortgage-interest-deduction-is-ripe-for-reform https://www.cbpp.org/research/mortgage-interest-deduction-is...
- ec109685 4y agoOnly one home is deductible: “ The interest you pay on a mortgage on a home other than your main or second home may be deductible if the proceeds of the loan were used for business, investment, or other deductible purposes. Otherwise, it is considered personal interest and isn't deductible. Main home. You can have only one main home at any one time.”
- eigen 4y ago> Only one home is deductible > "other than your main or second home" 2 homes are deductible.
- vaidhy 4y agoNo.. only one home.. but you get to choose which of your homes you can deduct.
- zerocrates 4y agoYou're wrong: the deduction covers your "main home" plus a "second home" of your choice. Both are combined under the same $750,000 limit.
- ec109685 4y agoCan you cite the statute? “ Mortgage interest. Many U.S. homeowners can deduct what they paid in mortgage interest when they file their taxes each year. (The rule is that you can deduct a home mortgage's interest on the first $750,000 of debt, or $375,000 if you're married and filing separately.”
- maxerickson 4y agoIt's not a statute, but this IRS guidance clearly discusses deducting the combined interest. https://www.irs.gov/publications/p936 https://www.irs.gov/publications/p936
- zerocrates 4y agoThe mortgage interest deduction is "qualified residence interest" in the statute. 26 USC §163(h)(3) allows deduction of interest "with respect to any qualified residence of the taxpayer." "Qualified residence" is itself defined at 26 USC §163(h)(4)(A)(i) as the taxpayer's "principal residence" and "1 other residence of the taxpayer."
- notahacker 4y ago> The government is very good at filtering that money through processes and contractors that extract as much of it as possible. The main benefit of reducing the safety net to a basic income is the elimination of a massive amount of administrative overhead. This isn't really a benefit though, as the administrative overhead costs a lot less than the alternative of giving everyone money.