The IRS lets you deduct your mortgage interest, but only if you take the itemized deduction. You can't deduct the principal (the borrowed money you're paying back).
In addition to itemizing, these conditions must be met for mortgage interest to be deductible:
- The loan is secured by your main home or a second home. "Secured" means the home is put up as collateral to protect the lender.
- The home with the secured loan must have sleeping, cooking, and toilet facilities.
- You or someone on your tax return must have signed or co-signed the loan.
- If you rented out the home, you must have used the home at least 14 days during the tax year or 10% of the number of days you rented it out, whichever is greater.
Mortgage interest is usually reported on Form 1098, Mortgage Interest Statement. After you enter your 1098 in TurboTax, we'll ask a series of follow-up questions to make sure you're qualified to take the deduction.
To enter your Home Equity Line of Credit (HELOC) mortgage interest :
- Type mortgage interest in the search bar and click search.
- Click on Jump to mortgage interest.
- Continue with the onscreen interview to enter your HELOC mortgage interest.