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sg99
Level 1

Married filing separately mortgage interest

My spouse and I are MFS since this will be SIGNIFICANTLY reduce his loan payment under PSLF program. 

 

We own a home with Loan of $720,000 in community property state. How do we apply the "Limitation On Acquisition Indebtedness" ? I understand for MFS this is $375,000. 

 

Does that mean we are each responsible for 50% of the loan balance (360k) and are therefore able to can claim 50% of total mortgage interest that was paid 2019? 

 

Thanks! 

1 Best answer

Accepted Solutions
ReginaM
Expert Alumni

Married filing separately mortgage interest

Yes, the Limitation on Acquisition is $375,000 for individuals filing Married Filing Separate.

 

Since you live in a community property state (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, or Wisconsin), you will want to divide the 1098 deductions 50/50.)  

 

Here is a link to IRS Publication 936, Home Mortgage Interest Deduction if you have further questions.

 

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1 Reply
ReginaM
Expert Alumni

Married filing separately mortgage interest

Yes, the Limitation on Acquisition is $375,000 for individuals filing Married Filing Separate.

 

Since you live in a community property state (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, or Wisconsin), you will want to divide the 1098 deductions 50/50.)  

 

Here is a link to IRS Publication 936, Home Mortgage Interest Deduction if you have further questions.

 

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

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