Are You Getting The Mortgage Interest Tax Deduction?
If you’re a homeowner, then you’ll want to be sure you’re getting the full mortgage-interest tax break. You can usually deduct the interest you pay on a mortgage for your main home or a second home.
The interest on your home mortgage may be fully deductible as an itemized deduction. There is no dollar limit on the amount of interest you can deduct annually, but there are limits on the size of the mortgage on which the interest is claimed. The mortgage interest rules applies to both fixed and adjustable rate mortgages.
For your mortgage interest to be deductible it must meet these rules.
- The debt must be secured by the residence
- You interest on no more than two residences
- You are personally obligated for repayment of the debt
For the IRS, a home can be a house, condominium, cooperative, mobile home, boat, recreational vehicle, or similar property that has sleeping, cooking, and toilet facilities.
Your home mortgage must be secured by your main home or your second home. You can’t deduct interest on a mortgage for a third home, a fourth home, and so on. If the loan is not a secured debt on your home, it is considered a personal loan and the interest you pay isn’t deductible.
A deduction for mortgage interest is limited to two residences, your main home and a second residence.
To deduct interest on a home mortgage you must be personally obligated for it’s repayment.
So, if you’re a home-owner, be sure to see, if you qualify for the mortgage-interest tax break this year.
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