wrote in message
ups.com...
Yep, they're all about lower taxes.....

A tax reform proposal agreed upon Tuesday by President Bush's advisory
panel would eliminate the federal deduction for state and local taxes
and sharply limit the tax break for home mortgage interest.

I seriously doubt that Bush would accept any proposal that included reducing
or eliminating the home mortgage deduction. this is out of a bipartisan
advisory panel.



That's leading some Democrats in California and New York to assail it
as an attack on the blue states -- the ones that voted Democratic in
the 2004 presidential election -- which tend to have higher taxes and
housing costs.

There were Democrats sitting on the panel too.


"The Bush panel's recommendations are a double-barreled blast aimed
squarely at California and the middle class," state Treasurer Phil
Angelides said in a press release. "These recommendations are good for
Texas, but bad for California."

Sen. Charles Schumer, D-N.Y., called it a pernicious proposal and a
"dagger to the heart of the people of New York."

The bipartisan panel, appointed by Bush early this year, was asked to
identify ways to simplify federal tax laws and redistribute the
"burdens and benefits" of federal tax "in an appropriately progressive
manner while recognizing the importance of homeownership and charity."
Its proposals, on balance, are supposed to neither raise nor lower
federal tax revenue.

Most observers think the proposal has little chance of adoption because
of the broad range of interest groups -- not to mention political
sacred cows -- it would threaten. Still, the plan is expected to spark
a far-reaching debate on tax reform.

The plan, which the panel plans to finish up next week, would simplify
taxes for the about one-third of taxpayers who itemize deductions -- by
eliminating them. Schedule A, the IRS form used to itemize deductions,
would go bye-bye along with many other tax-return forms.

The deduction for interest on a home mortgage, the biggest write-off
for many taxpayers, would be eliminated and replaced with a tax credit.


Under current law, taxpayers who itemize deductions can deduct interest
on up to $1 million in mortgage debt. The interest can be on one or two
homes as long as it doesn't total more than $1 million.

A deduction reduces income before taxes are calculated. The higher your
tax rate, the bigger the benefit.

A tax credit, by comparison, reduces your final tax bill dollar for
dollar, regardless of income.

The proposal calls for replacing the mortgage-interest deduction with a
tax credit equal to 15 percent of the interest paid on one home.

This would hurt me pretty badly. Currently, I get about $15,000 in tax
savings due to the deductibility of my home mortgage. I figure that I'd end
up paying an additional $8000 in taxes each year if they limit the credit to
15% of interest paid on my home.

I'm all for eliminating the home mortgage deduction...BUT only if they first
lower my marginal rate, and create a flat tax across the board for all
income levels.