If all your mortgages fit one or more of the following categories, you can generally deduct all of the interest you paid during the year.
- Mortgages you took out on your main home and/or a second home on or before October 13, 1987 (called "grandfathered" debt, because these are mortgages that existed before the current tax rules for mortgage interest took effect).
- Mortgages you took out after October 13, 1987 to buy, build or improve your main home and/or second home (called acquisition debt) that totaled $1 million or less for tax years prior to 2018 ($500,000 if you are married and filing separately from your spouse) or $750,000 or less for tax years beginning with 2018. Mortgages that existed as of December 14, 2017 will continue to receive the same tax treatment as under the old rules.
- Home equity debt you took out after October 13, 1987 on your main home and/or second home that totaled $100,000 or less throughout the year ($50,000 if you are married and filing separately) for tax years prior to 2018. Interest on such home equity debt was generally deductible regardless of how you use the loan proceeds, including to pay college tuition, credit card debt, or other personal purposes. This assumes the combined balances of acquisition debt and home equity do not exceed the home's fair market value at the time you take out the home equity debt. Beginning in 2018, the interest on home equity debt is no longer deductible unless it was use to buy, build, or substantially improve your home.
@df_Q I am leaving a couple of links below that will hopefully clear things up. If not, please start a new thread here. Thanks!
Deducting Mort age Interest
Mortgage Interest FAQs
Can I deduct interest on a home equity loan or a HELOC?
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