Is my home equity loan still tax deductible if I no longer have a mortgage?
Tags:home equity loan, mortgage, tax deduction,
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We only paid off a mortgage, though have an superb home equity loan, which you took out to good from a taxation deduction. Now which a debt is paid off, we’re wondering if a loan is still deductible.
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Till your loan is fully paid off, you can claim the interest amount as paid by you or accrued on the loan as Income Tax benefit but if you money pay it otherwise you are unnecessary paying interest.
Yes, the interest is still deductible.
Keep in mind that you don’t what to pay interest just to get a tax deduction.
It is a debt secured by your house, but it is not acquisition debt, so there are restrictions. If the loan is for less than $100,000 then the interest is fully deductible. If the loan is for more than $100,000 the interest is deductible only if the loan paid for improvements to the house.
Your equity loan is still tax deductible, but the paid mortgage is not, because you can only deduct the interest you have paid for the year. You can also still deduct the taxes you paid for the year on the property. For further information regarding this, consult your accountant.