Recent proposals to limit federal tax deductions for costs such as mortgage interest could harm Long Island’s housing market and “drag down” its economy, the region’s largest business group warned in a letter to newly confirmed Treasury Secretary Steve Mnuchin.
Long Island homeowners “rely heavily” on the ability to deduct mortgage interest and state and local taxes on their federal tax returns, Kevin Law, chief executive of the Long Island Association, wrote in a letter mailed Wednesday.
Law urged Mnuchin to preserve those tax deductions, or at least “consider high-cost, high-tax regions like Long Island before adopting a uniform policy for the entire country.”
News reports suggest that Mnuchin “may be supportive of reducing and/or eliminating” homeowners’ ability to deduct those expenses, Law wrote.
In an interview on CNBC in November, after the presidential election, Mnuchin predicted Donald Trump’s administration would “cap mortgage interest but . . . allow some deductibility.”
The Treasury Department did not respond to a request for comment.