Do you know the mortgage interest deduction lets homeowners deduct the interest on their home mortgage up to $1 million ($500,000 if you’re married filing separately)?
In fact, because a greater share of the house payment during the first few years of the loan goes toward interest, roughly two-thirds of the monthly mortgage payment is deductible interest.
That can translate to a hefty tax deduction!
For example, a $200,000, 30-year fixed-rate mortgage at 4% will result in $8,000 interest the first year you own your home. Deducting that interest will save you $2,000 if you’re in a 25% income tax bracket ($8,000 x 0.25 = $2,000) and even more if you are in the 15% bracket.
PT. 2 Property Tax Deduction.
Pt. 3. Points Deduction.
Pt. 4. Mortgage Insurance Deduction.
Pt. 5. Going "Green" Deduction.