Interest on real estate loans

From the 2024 DOR Tax Exemption Study

82.04.4292 - Interest on real estate loans Description Banking, lending, security, and other financial businesses with locations in 10 states or less may deduct interest income received on investments or loans primarily secured by first mortgages or trust deeds on non-transient residential properties. Interest amounts deductible include the portion of fees charged to borrowers, including points and loan origination fees, recognized over the life of the loan as an adjustment in the business' accounting records according to generally accepted accounting principles. Purpose To reduce the cost of purchasing a home. Taxpayer ($ in millions): savings FY 2024 FY 2025 FY 2026 FY 2027 State Taxes $78.462 $81.478 $84.610 $87.862 Local Taxes $0.000 $0.000 $0.000 $0.000 Repeal of Repealing this deduction would increase revenues. exemption Potential ($ in millions): revenue gains FY 2024 FY 2025 FY 2026 FY 2027 from full repeal State Taxes $0.000 $74.689 $84.610 $87.862 Local Taxes $0.000 $0.000 $0.000 $0.000 Assumptions - This repeal takes effect July 1, 2024, and impacts 11 months of collections in fiscal year 2025. - Growth rate mirrors the service and other activities B&O taxable activity g