Factors To Determine If Your Mortgage Interest Is Tax Deductible

1. IRS Limits & Guidelines On Mortgage Tax Deductible Interest

The IRS states that, “In most cases, you can deduct all of your home mortgage interest. How much you can deduct depends on the date of the mortgage, the amount of the mortgage, and how you use the mortgage proceeds.” This article gives you the details on each of those criteria. Believe it or not, in many cases even the interest on a boat or motor home can be considered tax deductible mortgage interest.

2. Calculate The Tax Deductible Amount of Mortgage Interest

This is a link to a mortgage calculator that can help you estimate the amount of tax benefit that may be generated by tax deductible mortgage interest.

3. Mortgage Interest Deduction Before And After Retirement

In general, the higher your tax bracket, the greater the potential benefit of a mortgage. Once retired, your tax bracket is likely to be lower. Evalutate the tax impact of your mortgage both before and after retirement; this can help you decide if you should pay off your mortgage once retired.

4. Should I Invest Or Pay Off The Mortgage - Comparing After Tax Results

This example will show you how to compare the after-tax return on your investments with the after-tax cost of your mortgage, assuming your mortgage interest is tax deductible.