In discussing a Slate article on the Advisory Panel‘s proposed changes to the tax code, Zimran concludes
From a federal standpoint there are no middle class families living in $500K houses. If you live in a $500K home and are surrounded by people who live in a $500K home and think you are middle class you are wrong — you are, in fact, rich and you live in a rich neighbourhood and you will be taxed.
That’s funny; I don’t feel rich. I’ll feel even less rich when the first mortgage payment comes due. But, Zimran, the proposed change would cap the deduction on mortgages in excess of $300,000. The relative weight of a mortgage may not be in proportion to the value of the house. To use an example from recent history, the mortgage on one property is $280,000. The property sold for $520,000 on the open market. The mortgage on another property is $360,000. That property sold for $390,000 on the open market. Which of these buyers is wealthier?