Sacramento, CA — A proposal by a presidential tax panel that would make higher home mortgages ineligible for tax breaks is running into strong criticism from California officials.
They say it would hurt people who live in the state´s hot housing markets. The recommendation by the President´s Advisory Panel on Federal Tax Reform would convert the home mortgage interest deduction into a credit equal to 15 percent of mortgage interest paid.
The $1 million limit on mortgages eligible for the tax break would shrink to the average regional price of housing, with an upper limit of $412,000. The proposals will be reviewed by Treasury Secretary John Snow, who says he hopes to present formal recommendations to President Bush later this year.