Obama pushes mortgage, charitable tax change

By Lisa Mascaro

Wednesday, March 25, 2009 | 11:01 a.m.

WASHINGTON -- President Barack Obama isn’t wilting from the pushback Nevada’s lawmakers and others have lodged over his budget proposal to lower the tax deduction the wealthy take on mortgage interest and charitable contributions.

In his prime-time news conference Tuesday night, Obama was asked if he regretted the proposal. As the Sun reported on Monday, this is one tax issue that has bonded most of Nevada’s Democrats and Republicans in Washington.

But the president seemed undeterred. Reducing the tax deduction rate for those families earning more than $250,000 would bring in more than $300 billion – a down payment on health care reform. The rate would be lowered from about 38 percent to 26 percent.

“It's the right thing to do, where we've got to make some difficult choices,” Obama said.

Obama explained that for charitable giving, "it just means, if you give $100 and you're in this tax bracket, at a certain point, instead of being able write off 36 or 39 percent, you're writing off 28 percent.”

Obama dismissed critics who say it would curtail generosity to charities. Roll Call reported this morning that Republicans in Congress are using the proposal to “gin up opposition” among charities.

“Now, if it's really a charitable contribution, I'm assuming that that shouldn't be a determining factor as to whether you're given that $100 to the homeless shelter down the street.”

The reduction would be similar for mortgage interest, but the president avoided that thorny subject. Even wealthy homeowners, as Democratic Rep. Shelley Berkley told the Sun, count on that that deduction.

Realtors oppose the change, worrying it would stretch family budgets and harm the economic recovery. A national realtors group ran a full-page ad in a Hill newspaper today opposing the move.

Some congressional watchers believe the proposal is essentially off the table.

But the president pressed on.

“Ultimately,” Obama said, “if we're going to tackle the serious problems that we've got, then in some cases those who are more fortunate are going to have to pay a little bit more.”