Mortgage Interest Deduction - What Are the Terms Used in the Income Tax Deduction For Mortgage Interest?
A person can only use the standard deduction for mortgage interest, if she is a homeowner. The first item to check out with your tax preparer is whether or not you are a homeowner. Mortgage interest is deductible as a home mortgage interest deduction if it is acquired using the mortgage as a loan. It must be used on the same property as the primary residence. If you are married and file a joint return, then both of you can make use of the combined deductions. Those homeowners who use their home as a place of business have to calculate their deduction based on the percentage of interest paid. Interest that is paid outside of the mortgage may be subject to an extra income tax. This amount is the sum of all interest paid plus interest paid on credit cards and loans. This can amount to a substantial amount. A mortgage cannot be used to purchase an additional unit that is used as a residence. Mortgage interest that is used as part of the refinancing of a loan can also be subject to income t...
