What is the point of a per-kid tax break?

[Cold_Zero]

Yet interest on car loans, personal loans, non federal student loans and business loans is the lenders/servicers receive is taxed as a profit, yet you can not deduct this interest from your Federal Income Taxes.

[Jimefam]

You can deduct interest paid on business loans from business income.

[Cold_Zero]

I see...

[smockers83]

FYI, the morgage interest tax deduction is because the money is already taxed as a profit to the mortgage company.

However true that is, that's not the reason as explained by Jimefam. It is an encouragement to buy a home and reduces the cost of doing so with that option. Buying a home spurs economic activity and the government is also in the mortgage industry. Prior to soaking up Fannie and Freddie, they had control of about 50% of the mortgages and with the crisis now, that's going to be up to 80%. More mortgages, more business, more money.

[C-Kwik]

If my memory serves me correct,the government encourages home ownership becuase of the way it stimulates the economy.

Whenever there is a home purchase stores like Home Depot, furniture stores, paint, wall paper,appliances,landscapers, decorators, perhaps the purchase of a second car, etc all benefit.

Telcoman

I don't think the purchase of a home drives up the purchase of the goods you mention by THAT much. People who rent still buy things they need to furnish their homes. Perhaps even some light non-permanent work. Landlords still need to maintain their property.

Perhaps there is more of a money supply angle, but I don't know and I'm way too burnt out on numbers at the moment to think about that possibility any further...

As for my thoughts on a kid tax break, I would love to see a comparison of how much government benefit a typical family with kids receives vs a couple with no kids. Then compare what they are putting in (as a percentage of their income).