Mortgage interest deduction

Qualified mortgage interest includes interest and points you pay on a loan secured by your main home or a second home. Your main home is where you live most of the time, such as a house, cooperative apartment, condominium, mobile home, house trailer, or houseboat. It must have sleeping, cooking, and toilet facilities.

A second home can include any other residence you own and choose to treat as a second home. You don't have to use the home during the year. However, if you rent it to others, you must also use it as a home during the year for more than the greater of 14 days or more than 10 percent of the number of days you rent it, for the interest to qualify as qualified residence interest. For more information regarding a qualified residence (home), see Publication 936, Home Mortgage Interest Deduction and Can I deduct my mortgage-related expenses?

Qualified mortgage interest and points are generally reported to you on Form 1098, Mortgage Interest Statement by the mortgage holder to which you made the payments. You can deduct interest for the following types of mortgages:

A mortgage you took out on or before October 13, 1987 (grandfathered debt)

A mortgage taken out after October 13, 1987, to buy, build, or improve your home (called home acquisition debt) but only if throughout the year these mortgages plus any grandfathered debt totaled $1 million or less. The limit is $500,000 if you're married filing separately. For homes acquired after December 15, 2017, the debt limitation is $750,000, or $375,000 if you're married filing separately.

If one or more of your mortgages doesn't fit into any of these categories, refer to Publication 936 to figure the amount of interest you can deduct as an itemized deduction.