San Diego, CA (PRWEB) April 28, 2014
One of the most trusted destinations for the latest news and expert loan advice, LoanLove.com, recently released a guide that explains home loan interest deduction savings and how homeowners can take advantage of these savings. The website is dedicated to empowering homeowners with first class knowledge, valuable resources, and connections to top rated industry professionals. The new guide to home loan interest deductions continues to keep borrowers updated with information that will help them to find and benefit from home loans that they will love.
This newly released guide, titled, “Mortgage Interest Tax Shield (Maximize Your Savings)” explains that there are many very good reasons to choose buying over renting; however, the chief benefit that is commonly brought up is the fact that mortgage borrowers are able to get a tax break by deducting the interest that they pay on their mortgages. The Loan Love mortgage interest tax shield guide says,
“If you are like most homeowners, nearly all of your mortgage payment every month is going toward interest and not your loan’s principle. The good news for taxpayers is that all that interest is deductible, as long as you itemize and don’t just take the standard deduction - Unless, of course, you had to take out a home mortgage of over $1 million. In that case, you can expect the Internal Revenue Service (IRS) to limit your mortgage interest deduction - More good news? It isn’t only your home’s first mortgage that paves the way for a tax break via a mortgage interest deduction. If you refinanced to improve your cash flow picture, or secured a home equity line of credit or home equity loan, you also get a tax break. The IRS allows you to take a full mortgage interest deduction for equity loans or credit lines up to $100,000.”
The guide explains that even those who one multiple properties will usually be able to deduct the interest from each separate mortgage they have, and in some cases even a loan on a boat may qualify for a mortgage interest tax deduction if the owner uses it as a primary or secondary living space. Loan Love also explains that those who pay points in order to get a better rate on their home loans may also be able to deduct them from their taxes. There are some differences as to how points are deducted, however. Loan Love explains,
“The IRS allows taxpayers to deduct points in the same year they pay them if the following holds true:
- The loan is for the purchase or construction of your primary residence
- Payment of points is an established business practice for your area
- The points you claim fall within the typical range
Different rules apply for homeowners who pay points during refinancing. In most cases, these points need to be deducted over the lifetime of the loan, on a per month basis for 12 months per tax year, rather than all in one year.”
For more information on deducting mortgage interest and points, click here to read the full guide.