Saving with the Mortgage Interest Tax Deduction

If you paid interest on a loan secured by your home last year, you can most likely claim a mortgage interest tax deduction and save yourself a bundle at tax time.


This page:

  • Describes who can claim home mortgage interest deductions

  • Lists the mortgage interest tax deduction tax return forms

The next two pages:

  • Explain how to deduct mortgage points

  • Describe how refinancing affects your deduction

Make claiming deductions easier

Do your taxes online, for free:
TurboTax allows you to work on your return for free, until you file. Work on your federal, state, and small business taxes, and pay nothing until you are satisfied with your return. Start now.

Avoid costly mistakes, and take advantage of all possible credits and deductions. (Claiming deductions is really easy with TurboTax).

Click here to start

How to claim mortgage interest deductions

Probably the most common deduction on U.S. tax returns are home mortgage interest deductions. Home loan interest, along with interest paid on loans used to invest, is deductible if you itemize.

Personal loan interest, which is accumulated by credit card debt or other consumer debt, is not deductible.

All types of home loans are deductible

The permissible home mortgage interest payments that can count toward your mortgage interest tax deduction can either be for a mortgage on your primary or secondary residence, a line of credit, or a home equity loan.

The only conditions that must be met for the interest payments to included in your mortgage interest tax deduction, is that you must be liable for repayment of the loan and the collateral for the loan must be your home.

You should receive Form 1098, the official mortgage interest statement, from your mortgage lender by the end of January. This statement will show your total mortgage interest and your total paid mortgage points. Tax deduction for both of these items is available.

If you are filing a paper tax return, you will need to fill out Schedule A, Form 1040 and include it with your return. All itemized tax deductions, including mortgage interest tax deductions, are claimed on this form.

Note: If you have not paid more than $600 in interest during the year, you may not receive Form 1098. In this case, you should enter the lender's name, address, and identification number in the appropriate box during the e-filing interview.

Some things that you should be aware of

There are, as with every other deduction, some limitations that apply to the home mortgage interest tax deduction.

Mortgage interest deductions vary based on the date of the loan, the use of the loan, and the amount of the loan. Each type of loan has different sets of rules - one type can be used for home improvement and still be deducted while another one cannot. It all depends on the kind of loan you have.


If you need help filing taxes, we highly recommend the TurboTax Premier edition, as it cuts down on mistakes and guides you through each section with ease.

Skip all the hassle - file electronically!

TurboTax Premier allows you to put away all forms, schedules and worksheets, and instead answer plain-English questions in a simple online questionnaire.

All the calculations are performed for you, and you get the benefit of knowing that all possible credits and deductions are accounted for.

Best of all, you can work on your return for free, and pay nothing until you file.

Try it now

Here are some more ways in which TurboTax Premier can help make filing your return easier:

Answer only questions that apply to you
Dramatically simplifies tax preparation by streamlining the interview, bypassing questions that don't apply to you.

Advice for New Tax Laws
Takes advantage of new laws to make the most of every new tax break.

Prepares for Next Year's Taxes
Automatically sets up data for next year's taxes as you prepare this year's taxes.

Plus EVERYTHING in the Basic Edition:

  • Step by step interview that walks you through your return
  • Automatically fills out form 1040 and all schedules for you
  • Get your investment, mortgage, and wage data instantly
  • Get the deductions you deserve
  • Takes advantage of new tax laws
  • Automatically double-checks for overlooked deductions and missed opportunities
  • File your state return too!


Try TurboTax Premier for Free Now

Next: deducting mortgage points.

Related IRS publications

You can get more information about the home mortgage interest tax deduction directly from the IRS, in the form of IRS Publication 936 (it's lots of fun.)

If you file a paper tax return, you will need to attach Schedule A with your return. If you e-file, any mortgage interest tax deductions will be calculated and the mortgage interest tax deduction form will be completed for you.

Note: you will need an Adobe Acrobat Reader to view these publications, which you can get here. (But you probably already have it.)