For many homeowners, the mortgage interest deduction is their biggest itemized deduction. Here's how to claim it and what limits apply.

Mortgage Interest Deduction

What's Deductible?

Interest on:

First and second homes
Home equity loans used to buy, build, or substantially improve the home

Loan Limits

Loans taken after December 15, 2017: Deduct interest on up to $750,000 of mortgage debt
Loans taken before December 16, 2017: Grandfathered at $1,000,000 limit
Married Filing Separately: Limits are halved

What Counts

Purchase mortgage (first and second home)
Home equity loan or HELOC if proceeds used to improve the home

What Doesn't Count

Home equity loan used for car, vacations, personal expenses
Points on refinancing (must be amortized)
Interest on loan for a third home or investment property (different rules)

How to Claim

Your lender sends Form 1098 showing mortgage interest paid
Enter on Schedule A (must itemize)

Points

Points paid to obtain a purchase mortgage are generally deductible in the year paid
Points paid on refinancing must be deducted over the loan term

When Itemizing Doesn't Help

If your total itemized deductions don't exceed your standard deduction ($30,000 for MFJ in 2025), the mortgage interest deduction provides no additional benefit.

Recent home purchase or refinance? Ensure you're capturing the full mortgage interest deduction.

The Mortgage Interest Deduction: Everything You Need to Know