Rich homeowners in blue states are among the biggest losers in the GOP tax plan

The GOP's tax plan is likely to advantage wealthy Americans in numerous ways, including with estate-tax and private-tuition benefits.

But where the housing market is concerned, proposed changes — particularly in the House version of the bill — are set to disproportionately hurt wealthier homeowners.

Many of the states with the most expensive housing markets, including California, New York, and Hawaii, also happen to lean Democratic. And while it might be a stretch to say those tax changes target blue states, they almost certainly would hurt high-income areas more.

Two policy proposals in the House and Senate versions of the bill are worth noting. First is the mortgage interest deduction, which helps homeowners lower their taxable income.

The Senate's bill leaves the threshold of the first $1 million of a mortgage unchanged. But it also hikes the standard deduction for all taxpayers, meaning it may no longer be better for some households to itemize the mortgage interest deduction since it would be lower than the standard deduction.

The House's plan is more significant. It halves the mortgage interest deduction to the first $500,000 of a loan.
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