This 5 page paper examines the capital gains tax as it concerns sale of real estate. Taxation on real estate is discussed in a general manner. Bibliography lists 5 sources.
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one can clearly see that this is the case. Schedule A allows one to deduct not only mortgage interest but real estate taxes as well. In fact, one can even
prepay their real estate taxes and mortgage payments to reap an even higher deduction (Clarkin, Mullany & Morris, 2004). This is a positive thing. A flat tax for example
would eliminate Schedule A and would not allow such deductions (Kamensky, 1996). Also, in one experts analysis, a flat tax would not eliminate the dreaded Schedule D where capital gains
from home sales would be found (1996). Of course, the much discussed flat tax is not likely to happen anyway. Hypothetically, it would be a negative factor for home owners.
The present system benefits home owners, but there are detriments, particularly when an individual wants to sell his or her home. Real estate is prudent to won. Home ownership creates
a great deal of wealth as by and large it is an appreciating asset. Further, the law usually favors homeowners. Things like homestead rebates are given by some state jurisdictions.
Finally, the government encourages home ownership because it is a way to help the average individual create wealth. This is desirable in order to create a society where people can
to some extent take care of themselves. That said, there are many complaints about the law as it involves home ownership. In a hypothetical example, one is a
U.S. Senator. What rules and regulations of the Internal Revenue Code and the accompanying state Rules and Regulations might one modify? There are many unfair things in the I.R.
S. code. Although it is true that home ownership provides a definite tax advantage, the transfer of real estate or the selling of ones home--unless one buys another--can be costly.