You can deduct mortgage interest on up to $750,000 of qualified mortgage debt if the mortgage was taken out after December 15, 2017. For married taxpayers filing separately, the limit is $375,000. This applies to interest on your primary residence and a second home, provided the mortgage is secured by the home and the loan proceeds were used to buy, build, or substantially improve the home. If your mortgage was obtained before December 16, 2017, you can deduct interest on up to $1 million of mortgage debt ($500,000 if married filing separately). Mortgages taken out on or before October 13, 1987, have no limit on deductible interest. Home equity loan interest is deductible only if the loan proceeds were used to improve the home and are included within the $750,000 or $1 million limits. Note that you must itemize deductions on your tax return to claim the mortgage interest deduction, and the Tax Cuts and Jobs Act (TCJA) provisions limiting the deduction to $750,000 will revert to $1 million after 2025 unless Congress acts otherwise
. Summary:
- Mortgages after Dec 15, 2017: Deduct interest on up to $750,000 debt ($375,000 if married filing separately)
- Mortgages before Dec 16, 2017: Deduct interest on up to $1 million debt ($500,000 if married filing separately)
- No limit for mortgages on or before Oct 13, 1987
- Home equity loan interest deductible only if used for home improvement
- Must itemize deductions to claim
- Current $750,000 limit reverts to $1 million after 2025 unless changed by Congress
This means the amount of mortgage interest you can deduct depends on when you took out your mortgage, how much mortgage debt you have, and whether you itemize deductions on your tax return.
