President Bush said that he wouldn't allow the elimination of the mortgage interest deduction as part of suggested changes to the tax code.
While taking questions after a speech in Florida, was asked by a homeowner to make sure housing remains affordable.
According to published reports, Bush replied, " Maybe you're hinting at whether or not the mortgage deduction would be part of a plan. I don't think you have to worry about the mortgage deduction not being a part of the income tax law."
The President's Advisory Panel on Tax Reform recommended in its November report that the current mortgage deduction of interest on up to $1.1 million of mortgage debt, which is available only to taxpayers who itemize their deductions, be replaced with a simplified home credit. The credit would be available to all taxpayers and worth 15 percent of the mortgage interest paid. The one restriction to the change would be a limit on the credit tied to the average regional price of housing -- at the time spanning from $227,000 to $412,000.An overhaul of the tax code was originally planned as a key part of President Bush's second-term agenda, but any changes would have problems gaining traction in a mid-term election cycle. The Treasury is currently reviewing the recommendations issued by the panel before submitting a plan to the president.
