Before making a good research most homebuyers believe that they will be able to deduct mortgage interest expenses. However, there is no easy way to get this deduction. Let’s determine what requirements you need to meet before getting approval for tax deduction:
- You need to pay the mortgage by yourself to get a deduction as a taxpayer.
- You need to be an actual borrower who is repaying the mortgage.
- In case you are not liable on the mortgage, you need to have legal title to the house.
- As a taxpayer you need to secure qualified residence interest. It can be any interest on acquisition or home equity indebtedness that accrued or was paid during the taxable year.
- You can deduct interest on the first $1,000,000 of acquisition debt and the first $100,000 of home equity debt.
Considering these points you need to negotiate your mortgage agreement.