I have a private loan on my home how do Iright off interest charged

[spimodels]

how do list my private loan interest on my home

[rjs · Accepted solution]

What exactly do you mean by a "private loan"? Is the mortgage loan from the person that you bought the home from (a seller-financed loan)? If so, enter it in the regular mortgage interest section. When you get to the screen that says "Do any uncommon situations apply?" select "The seller is financing this loan and I didn't receive a 1098."

If it's not a seller-financed loan, is the loan secured by your home? If not, you cannot deduct the interest. See the definition of Secured Debt in IRS Publication 936.

Mortgage interest that was not reported on Form 1098 has to be entered on Schedule A line 8b. If it's not a seller-financed loan the entry can only be made in forms mode. That means there is no way to make the entry in TurboTax Online. Forms mode is only available in TurboTax Desktop, not in TurboTax Online.

In forms mode, enter the interest directly on Schedule A line 8b. Do not use the Home Mortgage Interest Worksheet. But when you enter it this way, TurboTax will not calculate any limits that might apply to the deduction. See "Part II. Limits on Home Mortgage Interest Deduction" in IRS Publication 936 to see if any limits apply to your deduction. If it's not a seller-financed loan you do not need the lender's Social Security number or EIN.

Whatever the situation is, keep in mind that you cannot deduct your entire mortgage payment. You can deduct only the portion of the payment that is interest.

Note that mortgage interest is an itemized deduction. It will not make any difference in your tax or your refund unless your total itemized deductions are more than your standard deduction.

[TomK2023]

The IRS is a bit more "particular" about private loans than they are with "big bank mortgages"; in order to deduct the interest, the loan must be legally secured by the home.

There should be a recorded deed of trust or mortgage filing in your local county records.   The IRS typically won't allow the deduction if the  private loan is just a "handshake" agreement or a personal note not tied to the property,

Since you won't have a standard Form 1098 from a bank, you have to enter the details manually:

1. Open or continue your return.
2. Under Federal tab, Click on Deductions & Credits.
3. Under Your Home section, Click Start/Revisit next to Mortgage Interest and Refinancing (Form 1098).
4. Select "No", when asked "Did you get a 1098 for your mortgage?"
5. Proceed through the manual entry screen(s).

You must provide the lender's details to prove the interest paid (per IRS guidelines):

• Lender’s Name and Address (individual or private entity you pay).
• You will need the lender’s Social Security Number (SSN) or Employer Identification Number (EIN).
• The exact amount of interest you paid during the tax year (excluding any principal payments).

Note: your total itemized deductions (mortgage interest, property taxes, state taxes, charitable gifts) must be higher than the Standard Deduction (approx. $15,000 for individuals and $30,000 for MFJ) for applying this deduction to be beneficial..

Important: Make sure the loan is recorded with your local government.  If the IRS audits you, they will look for a "recorded instrument" that proves the home is collateral for the loan.

You can generally deduct interest on up to $750,000 of mortgage debt (or $375,000 if married filing separately).

Since you are deducting this interest, the person lending you the money is required to claim that same amount as taxable income on their own return. 

Please also see Champ "rjs's" reply above.  He is correct.  I based my answer assuming that this loan was "seller-financed."  

[Edited 4/17/26 | 9:38AM PST]

@spimodels 

@rjs