The Supreme Court has ruled that a Florida man can keep a mortgage interest deduction if he pays the mortgage off.
Key points:The court found that the law exempts the mortgage interest tax from the federal income taxThe court said it would not apply to homeowners who have a mortgage on their homeA Florida man who owes about $10,000 on his mortgage can keep the deductionA judge ruled that the mortgage deduction should not be limited to homeowners with mortgages on their homesA state appeals court had ruled that Florida’s mortgage- interest deduction should be available to homeowners that had mortgages on the property, as well as renters.
“It is not fair that the taxpayer should be forced to take the deduction for the rest of the taxpayer’s life in order to live a life that is as comfortable as possible,” Chief Justice Mary Roberts wrote in the ruling.
“If this is the case, the taxpayer has no choice but to pay the mortgage.”
The ruling comes after Florida’s governor signed a bill in April allowing residents of Florida to deduct mortgage interest from their taxes, in a move to allow the state to take in more money.
A spokeswoman for Gov.
Rick Scott said the state would continue to fight the ruling, but said the tax exemption would not be available for anyone.
The decision could lead to further court challenges.
A mortgage interest-deduction law is the biggest source of state income tax in the US, with about $1.3tn of property taxes collected annually.
In March, a Florida court upheld the state’s law, saying that it would be “an abuse of power” to deny the deduction to residents of a state that does not levy property taxes.
The Florida case is one of a number of recent court decisions that have extended the tax-exemption to homeowners.
The ruling also found that Florida has no right to deny its residents the mortgage tax deduction, as a condition of receiving federal aid, because the state is in a “loose fiscal position” as a result of the recession.
In a statement on Friday, the Florida attorney general said that Florida had “done nothing wrong” and said the ruling was a victory for Floridians who were struggling to make ends meet after the recession took its toll.
“Our legal fight is far from over,” Scott said in a statement.
“We have always believed that our state tax system should be fair and not discriminatory to any one group or group of Floridans.”