Single filers and those married filing jointly in most cases can deduct full interest on mortgages up to $750,000. This applies to any personal residence, be it your first or second. The previous limit was $1 million in mortgage debt, which still applies on home loans taken out before Dec. 16, 2017.
Previously, you could borrow against home equity and take a deduction on the interest regardless of whether the proceeds were used to pay off a credit card, take a vacation, or buy a second home. Now, you can deduct interest on home equity debt only if the funds were used “to buy, build, or substantially improve the taxpayer’s home that secures the loan.” In addition, as under the old rules, the loan must be secured by your primary or second home, and can’t exceed the cost of the home.
You can deduct property taxes on your second home and, for that matter, as many properties as you own. However, here too, the TCJA has brought changes that affect those deductions.
You can no longer deduct the entire amount of property taxes you paid on real estate you own. Now, the total of state and local taxes eligible for a deduction—including property and income taxes—is limited to $10,000 per tax return, or $5,000 if you're married and filing separately. Many people who buy a second home may already exceed that limit with their first home, and so will not see additional tax savings from their second home.
HOA and other expenses such as utilities and maintenance are not deductible unless you use a part of the property in a business, in which case you may be able to deduct a pro rata portion of maintenance expenses.
Answers are correct to the best of my ability but do not constitute legal or tax advice.
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