As part of President Obama's budget proposal for 2010, the mortgage interest deduction for high income taxpayers will be reduced.
The proposal (according to the Wall Street Journal today, 2/27/09) is to reduced the amount that can be deducted for those in the 33% (joint filers with $200,300 to $357,000 in taxible income) and 35% tax brackets (joint filers with over $357,000 in taxible income). Those in these higher brackets will only be able to deduct interest at the 28% rate.
Thus for each $1000 of interest, there is a $350 deduction (at the 35% bracket) and with the budget proposal, it would be reduced to $280.00
The good news is that the majority of taxpayers won't be effected by the proposal - lets just hope that this idea doesn't spread to include other tax brackets!!