You must file Form 1040 to deduct any home mortgage interest expense on your tax return. Where you deduct your interest expense generally depends on how you use the loan proceeds. See Table 23-1
for a summary of where to deduct your interest expense.
Deduct the home mortgage interest and points reported to you on Form 1098 on Schedule A (Form 1040), line 10. If you paid more deductible interest to the financial institution than the amount shown on Form 1098, show the larger deductible amount on line 10. Attach a statement explaining the difference and print "See attached" next to line 10.
Deduct home mortgage interest that was not reported to you on Form 1098 on Schedule A (Form 1040), line 11. If you paid home mortgage interest to the person from whom you bought your home, show that person's name, address, and taxpayer identification number (TIN) on the dotted lines next to line 11. The seller must give you this number and you must give the seller your TIN. A Form W-9, Request for Taxpayer Identification Number and Certification, can be used for this purpose. Failure to meet any of these requirements may result in a $50 penalty for each failure. The TIN can be either a social security number, an individual taxpayer identification number (issued by the Internal Revenue Service), or an employer identification number. See Social Security Number
in chapter 1 for more information about TINs.
If you can take a deduction for points that were not reported to you on Form 1098, deduct those points on Schedule A (Form 1040), line 12.
Deduct mortgage insurance premiums on Schedule A (Form 1040), line 13.taxmap/pub17/p17-128.htm#en_us_publink1000173327
If you and at least one other person (other than your spouse if you file a joint return) were liable for and paid interest on a mortgage that was for your home, and the other person received a Form 1098 showing the interest that was paid during the year, attach a statement to your return explaining this. Show how much of the interest each of you paid, and give the name and address of the person who received the form. Deduct your share of the interest on Schedule A (Form 1040), line 11, and print "See attached" next to the line. Also, deduct your share of any qualified mortgage insurance premiums on Schedule A (Form 1040), line 13.
Similarly, if you are the payer of record on a mortgage on which there are other borrowers entitled to a deduction for the interest shown on the Form 1098 you received, deduct only your share of the interest on Schedule A (Form 1040), line 10. You should let each of the other borrowers know what his or her share is. taxmap/pub17/p17-128.htm#en_us_publink1000173328
If your home mortgage interest deduction is limited, but all or part of the mortgage proceeds were used for business, investment, or other deductible activities, see Table 23-1
. It shows where to deduct the part of your excess interest that is for those activities.
Deduct investment interest, subject to certain limits discussed in Publication 550, on Schedule A (Form 1040), line 14.taxmap/pub17/p17-128.htm#en_us_publink1000173331
There are various ways to treat the premium you pay to buy taxable bonds. See Bond Premium Amortization in Publication 550.taxmap/pub17/p17-128.htm#en_us_publink1000173332
Deduct interest on a loan for income-producing rental or royalty property that is not used in your business in Part I of Schedule E (Form 1040).taxmap/pub17/p17-128.htm#en_us_publink1000173333
You rent out part of your home and borrow money to make repairs. You can deduct only the interest payment for the rented part in Part I of Schedule E (Form 1040). Deduct the rest of the interest payment on Schedule A (Form 1040) if it is deductible home mortgage interest.
Table 23-1. Where To Deduct Your Interest Expense
|IF you have ...||THEN deduct it on ...||AND for more information go to ...|
|deductible student loan interest||Form 1040, line 33, or Form 1040A, line 18||Publication 970.|
|deductible home mortgage interest and points reported on Form 1098||Schedule A (Form 1040), line 10||Publication 936.|
|deductible home mortgage interest not reported on Form 1098||Schedule A (Form 1040), line 11||Publication 936.|
|deductible points not reported on Form 1098||Schedule A (Form 1040), line 12||Publication 936.|
|deductible mortgage insurance premiums||Schedule A (Form 1040), line 13||Publication 936.|
|deductible investment interest (other than incurred to produce rents or royalties)||Schedule A (Form 1040), line 14||Publication 550.|
|deductible business interest (non-farm)||Schedule C or C-EZ (Form 1040)||Publication 535.|
|deductible farm business interest||Schedule F (Form 1040)||Publications 225 and 535.|
|deductible interest incurred to produce rents or royalties||Schedule E (Form 1040)||Publications 527 and 535.|
|personal interest||not deductible.|