House tax bill will cap mortgage interest deduction, leave 401(k)s unchanged

The Chicago Tribune reports:

The House GOP tax plan would dramatically lower the cap on widely-used mortgage interest deductions to new loans totaling no more than $500,000, down from the current $1 million, according to a draft of the plan released Thursday.

It would also immediately slash the corporate rate to 20% from 35%, eliminate deductions for state and local income taxes, cap property tax deductions at $10,000 and leave unchanged the popular 401(k) retirements savings plans used by many Americans.


The change in mortgage interest deductions, which would only impact home purchases and mortgages going forward, is likely to deliver a significant blow to many homeowners.

Some liberals have long complained the mortgage interest deduction largely benefits wealthier homeowners and wanted to see it limited. But they had hoped to use the savings to pay for more affordable housing, not tax cuts for businesses and the wealthy.

Changes.