, Answering FAQ'sTurboTax Employee
Subject to conditions described below, you may deduct mortgage interest you pay on a loan secured by your main home or a second home. Your main home is where you live most of the time. They can be a house, cooperative apartment, condominium, mobile home, house trailer, recreational vehicle, or houseboat that has sleeping, cooking, and toilet facilities.
A second home can include any other residence you own and treat as a second home. You do not have to use the home during the year. However, if you rent it to others, you must also use it as a home during the year for more than the greater of 14 days or 10 percent of the number of days you rent it, for the interest to qualify for a mortgage interest deduction.
For more information regarding the deduction for mortgage interest, see IRS Publication 936.
What are the conditions for deducting home mortgage interest?
The following mortgages qualify as home mortgages, and you can deduct all of the interest on these mortgages:
- Grandfathered Debt. A mortgage you took out on or before October 13, 1987.
- Acquisition Debt. A mortgage taken out after October 13, 1987, to buy, build, or improve your home up to a total of $1 million for this debt plus any grandfathered debt. The limit is $500,000 if you are married filing separately.
- Home Equity Debt. Debt other than home acquisition debt taken out after October 13, 1987, up to a total of $100,000. The limit is $50,000 if you are married filing separately. Home equity debt other than home acquisition debt is further limited to your home's fair market value reduced by the grandfathered debt and home acquisition debt.
If one or more of your mortgages does not fit into any of these categories, refer to IRS Publication 936, Home Mortgage Interest Deduction, to figure the amount of interest you can deduct.
Mortgage interest and TurboTax
If you've already gone through the TurboTax step-by-step interview and want to jump directly to the entry screen for mortgage interest, follow these steps.
- Select Federal Taxes (Personal in the Home & Business edition).
In Online TurboTax, click the bars at the upper left corner to show Federal Taxes on the selection list; enlarge the screen if needed to show the left side selection list.
- Select Deductions & Credits, and in the next screen, click I'll choose what I work on..
- Scroll down the Deductions & Credits screen until you see the Your Home group.
- Click on the Start/Update button next to the Mortgage Interest topic,
- Follow the prompts.
- Form 1098, Mortgage Interest Statement
- How to Enter Mortgage Interest Points Not Reported on a Form 1098
- Schedule A, Itemized Deductions
- Refinanced Loans
- Mortgage Insurance Deduction