Abstract
Ventry traces the mortgage interest deduction from accident to birthright, from one of many deductible personal interest items to one of the few still standing, and from a negligible tax offset to the second most expensive tax subsidy. He examines the origins of the deduction for personal interest alongside the birth of the modern federal income tax and concludes that the deduction had nothing to do with encouraging or rewarding home ownership. Moreover, he also examines national rates of home ownership during depression, war, and postwar affluence. Home ownership rates stagnated and then receded during the Great Depression, with the housing industry and homeowners together suffering choked lines of credit and historically high foreclosure rates. Furthermore, he describes how the tax benefits associated with mortgage debt increased significantly under the federal income tax that emerged from World War II.
Citation
Dennis J. Ventry Jr.,
The Accidental Deduction: A History and Critique of the Tax Subsidy for Mortgage Interest,
73 Law and Contemporary Problems
233-284
(Winter 2010)
Available at: https://scholarship.law.duke.edu/lcp/vol73/iss1/9