by Jason Fichtner, Jacob Feldman
June 23, 2014
Working Paper Series
The mortgage interest deduction tax (MID) benefits those with higher incomes at the expense of those with lower incomes. Though the $69 billion deduction is often viewed as an element of the tax code that promotes middle-class prosperity, 64 percent of the effective tax reduction it provides goes to households earning more than $100,000 per year. High-income earners average a tax benefit nearly nine times greater than a tax filer earning $50,000-$100,000. In order to create a simpler, more efficient tax code, policymakers should take care to effectively align tax policy with housing objectives.