Massachusetts Attorney General Martha Coakley Tuesday called for the extension of a federal tax break that benefits struggling homeowners who are allowed to jettison mortgage debt.
Coakley joined 41 other attorneys general in urging Congressional leaders to extend the tax relief to borrowers who have had their mortgage debt canceled because their homes dropped in value or their incomes fell.
Comments
This is a story that shows just how hard "tax reform" will be. Once a deduction becomes law, they become "untouchable". Every one that is cut will affect some class of people, all with "dire" results. It is also an example of just how complex our tax code is, how much it affects everyone and how it distorts real economic decisions. It also highlights the unintended consequences of using the tax code to influence social behavior. We must simplify the code, have everyone has some tax obligations ("skin in the game") and be easy to understand. Severely limit or eliminate all deductions and set a reasonable tax schedule for everyone. This is fairness, as opposed to today when income taxes only reach half the population. JP05