The Variation of Homeowner Tax Preferences by Income, Age and Leverage

35 Pages Posted: 18 Nov 2007

See all articles by David C. Ling

David C. Ling

University of Florida - Warrington College of Business Administration

Gary A. McGill

University of Florida - Fisher School of Accounting

Abstract

It is well known that owner-occupied housing has long received favorable tax treatment in the U.S. federal income tax system relative to a system in which all income, regardless of its source, is subject to taxation. As a result, many economists have argued that the United States overinvests in owner-occupied housing relative to the investment that would result from a neutral income tax system. In addition, the distribution of the subsidy is often viewed as inequitable because high-income households receive the largest subsidy per dollar of housing. This article uses the 2005 American Housing Survey, conducted by the U.S. Department of Commerce, to perform a microlevel analysis of the current magnitude and distribution of homeowner tax preferences. We then assess how the magnitude and distribution of tax preferences would be altered by replacement of the mortgage interest deduction with a 15% credit.

Suggested Citation

Ling, David Curtis and McGill, Gary A., The Variation of Homeowner Tax Preferences by Income, Age and Leverage. Real Estate Economics, Vol. 35, No. 4, pp. 505-539, Winter 2007, Available at SSRN: https://ssrn.com/abstract=1030894 or http://dx.doi.org/10.1111/j.1540-6229.2007.00199.x

David Curtis Ling (Contact Author)

University of Florida - Warrington College of Business Administration ( email )

P.O. Box 117168
Gainesville, FL 32611
United States
352-392-9307 (Phone)
352-392-0301 (Fax)

Gary A. McGill

University of Florida - Fisher School of Accounting ( email )

Warrington College of Business
PO Box 117166
Gainesville, FL 32611-7166
United States
352-273-0219 (Phone)
352-392-7962 (Fax)

HOME PAGE: http://warrington.ufl.edu/fsoa/faculty/facultyinfo.asp?WEBID=1132

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