Rental Mortgage Interest
Rental mortgage interest is deductible even if you don't itemize, but you still don't report it directly on Form 1040. Instead, use Schedule E to report your rental income and expenses. If you paid the rental mortgage interest to a financial institution and received a Form 1098, report the amount on line 12 of Schedule E. Otherwise, it goes on line 13. Only the interest paid for the particular tax year is deductible. Prepaid interest must be deducted in the tax year to which the payment is applied. For example, if you prepaid January 2013's interest in December 2012, you have to wait until your 2013 tax return to deduct that interest. I hope this helps you. pet
