mortgage interest

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  • oceanlovin'ea
    Senior Member
    • Jun 2005
    • 2682

    #1

    mortgage interest

    Client paid mortgage interest on 3 properties last year. They had their home in Florida and bought a home in Idaho and one in Utah.
    Which means taht they paid mortgage interest on 3 properties. I was under the impression that you could only claim on your principal residence and a second home.

    They were planning a move to Utah where their children live. They had their house for sale and before it sold they bought a home in Utah, which is now their principal residence.

    I guess Idaho is a vacation home. Or possibly they bought it for investment and one of their kids is living in it part of the time.

    Am I right in thinking they can only use the mortgage interest on 2 of the properties. How would you decide which two? Does it matter?

    Linda
  • Lion
    Senior Member
    • Jun 2005
    • 4699

    #2
    Highest

    Pick the two with the highest mortgage interest, of course! And, it doesn't have to be the same two each year; so pick whichever are most beneficial each year, as long as they otherwise meet all the requirements.

    Comment

    • oceanlovin'ea
      Senior Member
      • Jun 2005
      • 2682

      #3
      Sold house in Florida

      They sold the house in Florida in December so it will only be this year that we will have a problem.

      The statement is from WAMU and the address it was mailed to is their daughter's address. I wonder if this might be a second mortgage on their Florida home. I'll have to email her and ask.

      Last night my brain was extremely tired. Maybe there isn't the problem that I thought I had.

      Linda

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      • oceanlovin'ea
        Senior Member
        • Jun 2005
        • 2682

        #4
        2nd mortgage

        They had a second mortgage on the Florida property. So it is all deductible.

        I really need to read the notes people send me.

        Thanks

        Linda

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        • Gretel
          Senior Member
          • Jun 2005
          • 4008

          #5
          If I understand correctly, they bought a third home with a 2nd mortgage on the first home?

          This mortgage is considered equity debt and would be deductible only to the extent that total equity debt doesn't go over $100,000.

          Comment

          • Davc
            Senior Member
            • Dec 2006
            • 1088

            #6
            Originally posted by oceanlovin'ea
            They had a second mortgage on the Florida property. So it is all deductible.



            Linda
            Maybe. What's the balance of that loan plus other home equity loans on the Florida property?

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