Log in Subscribe

What Interest Payments are Tax-Deductible?

By BARRY LISAK
Posted 7/3/17

Interest is an amount you pay for the use of borrowed money. To deduct interest you paid on a debt on your tax return, you must be legally liable for the debt and you must be able to itemize your tax deductions on your tax return. Interest-tax deductions fall into five major categories:

1. Home-mortgage interest. Home-mortgage interest is interest you pay on a loan secured by your main home and/or a second home. Your main home is where you live most of the time. It can be a house, cooperative apart­ment, condominium, mobile home, house trailer, or houseboat that has sleeping, cooking, and toilet facilities. The loan may be a mortgage to buy your home, a second mortgage, a home-equity loan, or a line of credit. Mortgage interest is reported to you on Form 1098, Mortgage Interest Statement by the lender to which you made the payments.

This item is available in full to subscribers.

Please log in to continue

Log in