Impact of Governors Budget On MID

Under the Governor’s proposal, (HB 87/SB 152), Maryland would scale back the most important tax benefit for many homeowners.

The proposal would reduce the Mortgage Interest Deduction and the deductibility of state and local property taxes for many Maryland homeowners.

For nearly 100 years, the tax code has protected mortgage interest deductibility.

Under the proposal, if a single Maryland taxpayer’s federal adjusted gross income exceeds $100,000, or married taxpayers income exceeds $150,000, that taxpayer’s itemized deductions, including mortgage interest and state and local property taxes, would decrease by 10% when calculating Maryland taxable income. Taxpayers with adjusted gross income over $200,000 would see their deductions decrease by 20%.

Mortgage interest and property taxes account for almost 70% of total itemized deductions in Maryland. Homeowners already pay their fair share in our state, contributing almost half of local government revenues in a state with one of the most aggressive real estate tax structures in the country. Housing and real estate contribute generate 20% of Maryland’s gross state product. More tax burdens on real estate and homeowners will only further hurt Maryland’s economic recovery.

Deductions for mortgage interest and state and local property taxes are vital incentives for a strong housing/real estate market recovery. Don’t allow them to be devalued.

With so many Marylanders facing diminished homeowner equity and/or underwater mortgages, this proposal would do more harm. Tell your legislators to PROTECT Maryland’s deductions for homeowners.

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