This paper examines the role of U.S. housing-related tax expenditures in creating incentives for decentralization and encouraging residential sorting by income and central city decline. Tax expenditures associated with the deductibility of mortgage interest and property taxes make housing less...

This paper examines the potential impact of the federal tax treatment of housing, which provides tax advantages that increase with income and house value, on the pattern of development in U.S. metropolitan areas. The authors argue that the tax treatment of housing is likely to have impacts on...

The U.S. tax code allows home owners to deduct mortgage interest and property taxes on their federal income tax forms. It also gives special treatment to the capital gains realized from the sale of owner-occupied housing. These advantages encourage investment in owner-occupied housing. But do...