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Interest You Paid The rules for deducting interest vary, de- pending on whether the loan proceeds are used for business, personal, or in- vestment activities. See Pub. 535 for more information about deducting busi- ness interest expenses. See Pub. 550 for more information about deducting in- vestment interest expenses. You can't deduct personal interest. However, you can deduct qualified home mortgage in- terest (on your Schedule A) and interest on certain student loans (on Schedule 1 (Form 1040), line 20), as explained in Pub. 936 and Pub. 970. If you use the proceeds of a loan for more than one purpose (for example, personal and business), you must allo- cate the interest on the loan to each use. You allocate interest on a loan in the same way as the loan is allocated. You do this by tracing disbursements of the debt proceeds to specific uses. For more information on allocating interest, see Pub. 535. In general, if you paid interest in 2020 that applies to any period after 2020, you can deduct only amounts that apply for 2020. Use Schedule A to deduct qualified home mortgage interest and investment interest. Line 8 Home Mortgage Interest If you are a homeowner who received assistance under a State Housing Finance Agency Hardest Hit Fund program or an Emer- gency Homeowners' Loan program, see Pub. 530 for the amount you can deduct on line 8a or 8b. A home mortgage is any loan that is se- cured by your main home or second home, regardless of how the loan is la- beled. It includes first and second mort- gages, home equity loans, and refi- nanced mortgages. A home can be a house, condomini- um, cooperative, mobile home, boat, or similar property. It must provide basic living accommodations including sleep- ing space, toilet, and cooking facilities. TIP Check the box on line 8 if you had one or more home mortgages in 2020 with an outstanding balance and you didn't use all of your home mortgage proceeds from those loans to buy, build, or substantially improve your home. In- terest paid on home mortgage proceeds used for other purposes isn’t deductible on lines 8a or 8b. See Limits on home mortgage inter- est, later, for more information about what interest you can include on lines 8a and 8b. If you used any home mortgage proceeds for a business or in- vestment purpose, interest you paid that is allocable to those proceeds may still be deductible as a business or investment expense elsewhere on your return. Limits on home mortgage interest. Your deduction for home mortgage in- terest is subject to a number of limits. If one or more of the following limits ap- plies, see Pub. 936 to figure your deduc- tion. Limit for loan proceeds not used to buy, build, or substantially improve your home. You can only deduct home mortgage interest to the extent that the loan proceeds from your home mortgage are used to buy, build, or substantially improve the home securing the loan ("qualifying debt"). Make sure to check the box on line 8 if you had one or more home mortgages in 2020 with an out- standing balance and you didn't use all of the loan proceeds to buy, build, or substantially improve the home. The on- ly exception to this limit is for loans tak- en out on or before October 13, 1987; the loan proceeds for these loans are treated as having been used to buy, build, or substantially improve the home. See Pub. 936 for more informa- tion about loans taken out on or before October 13, 1987. See Pub. 936 to figure your deduction if you must check the box on line 8. Limit on loans taken out on or be­ fore December 15, 2017. For qualify- ing debt taken out on or before Decem- ber 15, 2017, you can only deduct home mortgage interest on up to $1,000,000 ($500,000 if you are married filing sepa- rately) of that debt. The only exception is for loans taken out on or before Octo- ber 13, 1987; see Pub. 936 for more in- TIP formation about loans taken out on or before October 13, 1987. See Pub. 936 to figure your deduction if you have loans taken out on or before December 15, 2017, that exceed $1,000,000 ($500,000 if you are married filing separately). Limit on loans taken out after De­ cember 15, 2017. For qualifying debt taken out after December 15, 2017, you can only deduct home mortgage interest on up to $750,000 ($375,000 if you are married filing separately) of that debt. If you also have qualifying debt subject to the $1,000,000 limitation discussed un- der Limit on loans taken out on or be- fore December 15, 2017, earlier, the $750,000 limit for debt taken out after December 15, 2017, is reduced by the amount of your qualifying debt subject to the $1,000,000 limit. An exception exists for certain loans taken out after December 15, 2017, but before April 1, 2018. If the exception applies, your loan may be treated in the same manner as a loan taken out on or before December 15, 2017; see Pub. 936 for more infor- mation about this exception. See Pub. 936 to figure your deduction if you have loans taken out after October 13, 1987, that exceed $750,000 ($375,000 if you are married filing sepa- rately). Limit when loans exceed the fair market value of the home. If the total amount of all mortgages is more than the fair market value of the home, see Pub. 936 to figure your deduction. Line 8a Enter on line 8a mortgage interest and points reported to you on Form 1098 un- less one or more of the limits on home mortgage interest apply to you. For more information about these limits, see Limits on home mortgage interest, earli- er. Home mortgage interest limited. If your home mortgage interest deduction is limited, see Pub. 936 to figure the amount of mortgage interest and points reported to you on Form 1098 that are deductible. Only enter on line 8a the de- ductible mortgage interest and points that were reported to you on Form 1098. Refund of overpaid interest. If your Form 1098 shows any refund of over- paid interest, don't reduce your A-8