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Deductions & credits
@pascajams wrote:
I'm going to have to take required withdraws soon. I thought I could start pulling money out of my traditional IRA against my mortgage interest deductions.
When is "soon"? Do you have a required withdrawal (RMD) for 2021? Money that you withdraw in 2021 will not count towards a 2022 RMD.
If you never made nondeductible contributions to the IRA, any amount that you withdraw is added to your taxable income. Your taxable income is reduced by the amount of your mortgage interest deduction. So a $2,000 mortgage interest deduction will offset a$2,000 withdrawal from your IRA, if that's what you're trying to do.
Two other cautions:
1. Make sure you are actually getting the mortgage interest deduction. This plan doesn't work if your itemized deductions are not more than your standard deduction.
2. There are limitations on the mortgage interest deduction. You might not be able to deduct the full amount of interest that you pay. Make sure you know how much you are actually able to deduct.