Tax benefits of home ownership readily apparent each April
Every spring, as the weather warms and the days left before April 15 dwindle away, Americans from coast to coast are reminded of the tax benefits their home affords them. Without these benefits, the amount due Uncle Sam every 12 months would be substantially higher for most American taxpayers.
Despite its struggles in recent years, real estate continues to be one of the best long-term investments of all. Benefits of owning and maintaining one's own home include value appreciation over time, tax advantages, long-term financial security and the sense of freedom and accomplishment that comes with having a piece of property.
“It’s never really a pleasurable experience to sit down each year and compile your taxes, but I shudder to think how much more painful it would be if the federal government eliminated the mortgage interest deduction,” says Bob McVey, 2013 president of the Sussex County Association of Realtors. “If getting together with your accountant every April doesn’t emphasize the tax benefits of home ownership in the United States, I don’t know what will.”
While the mortgage interest deduction is one of the greatest benefits to home ownership in the United States, there has been talk in Washington in recent months of altering or even eliminating this tax benefit. This has Realtors from coast to coast up in arms and unifying behind a common cause, including those with SCAOR.
American homeowners who itemize their deductions can deduct the interest paid on their mortgage up to $1 million, plus up to $100,000 of home equity loans. But the MID costs the United States Treasury approximately $100 billion a year in revenues, and politicians from both major parties are eyeing the deduction as a potential revenue source. Members of the National Association of Realtors will not let that happen, however, without a major fight.
“Any time there is a possible revenue source like what would be created by eliminating the mortgage interest deduction, you’re going to have politicians conjuring up plans on how to go after that source,” says McVey. “But we, as Realtors, will fight that to our last breath, because it’s no secret that the housing markets are major economic drivers in the United States.
There is no questioning the impact an area’s housing market has on the economy. According to the National Association of Realtors, the sale of a home priced at $173,000 generates $58,529 in economic activity, including fees for real estate agents and title companies. But that figure also includes components like furniture, landscaping services and countless other items.
New home sales contribute even more to the local economy, from the Delaware beaches all the way to the abundant farmland communities in western Sussex. These contributions include construction materials and much-needed jobs for Sussex Countians.
The Sussex County Association of Realtors was chartered in 1949 and has steadily grown in size, scope and mission. It is a professional trade association with goals of carrying out programs of education and advocacy for real estate in the county.
To read more about issues related to Sussex County’s real estate industry, visit www.scaor.com.