In most cases, you can deduct the interest you pay on your mortgage from your taxes. However, in some cases, you cannot take the mortgage interest tax deduction.
The mortgage interest tax deduction is an itemised deduction, meaning you must give up the standard deduction to claim it. If the total of your itemised deductions does not exceed your standard deduction, or you choose not to itemise your deductions, you cannot claim the mortgage interest deduction.
The interest deduction is limited to the interest on the first £325,000 of the mortgage if you are single, or £0.6 million if you file a joint return with your spouse. If your mortgage exceeds these limits, some of the interest is not deductible.
You must be the one making the payments on the mortgage as well as the one who is legally liable for the loan for you to claim a deduction for the interest paid. If you are simply making a mortgage payment for someone else, you cannot claim a deduction.
The loan must be secured by your home in order to claim the mortgage interest deduction. Even if you use the proceeds of a loan to pay for your house, if the house is not legally listed as collateral you cannot claim the interest payments for the mortgage interest tax deduction.
Number of Homes
You can only deduct the interest on a home that you use as your first or second home. If you have a mortgage on a third home, you cannot deduct the interest.
- 20 of the funniest online reviews ever
- 14 Biggest lies people tell in online dating sites
- Hilarious things Google thinks you're trying to search for