The mortgage interest tax deduction might drive inequality

Have you ever thought that the mortgage interest deduction might power inequity in the tax code in the USA? Indeed, this might really take place.   

Some analysts have already figured out that this so popular mortgage interest deduction might bring more benefits to white men than to minorities and women, thus setting up an unfair cycle, keeping homeownership out of reach for many US citizens.  

If we compare different groups of US taxpayers, we’ll see that non-white US citizens are between 58% and 38% less likely to be able to benefit from the mortgage interest deduction than white American householders of the same income and age. Moreover, across the nation, US women are approximately 10.5% less likely to be capable of tapping the tax break.         

Experts consider a variety of possible explanations for why minorities tend to lose out in this regard. Perhaps, they might boast smaller and fewer intergenerational wealth transfers. As follows from this, they’re used to struggling more to come up with cash for their down payment. As for minorities, they’re also more likely to face financial difficulties sudden expenses arise.    



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