Who is Eligible?

• The mortgage must for a qualified house, be in your name, and you must itemize your deductions.
  
  

Qualified Houses

• Only interest on loans for your main house or a second house can be deducted. A house must have a place to sleep, cook and use the restroom.
  
  

Loans Used For Home Ownership

• For mortgages older than Oct. 13, 1987, all of the interest you pay on it is deductible. For mortgages taken out later, the interest on debt up to $500,000 for individuals and $1 million for couples is deductible.
  
  

Loans Used For Other Purposes

• If you took out a mortgage and didn't use the money to purchase, construct or repair your home, you can deduct interest on up to $50,000 for singles and $100,000 for couples.
  
  

Grandfathered Loans

• If you took out your mortgage before Oct. 13, 1987, there are no limits on the amount of debt the interest is deductible on. But older loans can affect whether interest from loans taken out after this date is deductible.