Is reverse mortgage interest tax deductible?

When you have a reverse mortgage, you don’t have a mortgage payment. Rather, interest accrues on your existing home equity and nothing is due until you sell the home, move out or pass away. Because it’s considered interest on home equity debt, it’s generally not considered tax-deductible.

What are other common tax deductions for homeowners?

In addition to the mortgage interest, the other big tax deduction for homeowners is usually the property tax deduction . It should be noted that this falls under the category of state and local taxes for which the total limit on deductions is $10,000 ($5,000 if married filing separately).

What forms will I need to deduct mortgage interest?

If you paid at least $600 in mortgage interest in the prior year, your lender will provide both you and the IRS with a copy of your Mortgage Interest Statement, Form 1098. From there, you can calculate your deductible mortgage interest based upon the limits we discussed above.

What’s The Mortgage Interest Deduction?