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How do I calculate mortgage interest deduction for two homes?
I own two homes and want to double check my interest deduction limit calc i correct.
Home 1 avg outstanding balance was $500,000. Home 1 interest paid was $16,000.
Home 2 avg outstanding balance was $1.4mm. Interest paid was $55,000.
What is the correct way to calculate my limit? Both properties were purchased after 2017, so limit is $750k.
Do you do properties individually? Or do I combine -- for example, combined Total Balance = $1.9mm (500k+1.4mm) -- divide this into the limit 750k gives 39%. Now, 39%*$71,000 (total interest paid) = $27,690., which is my max deductible amount.
Home 1 avg outstanding balance was $500,000. Home 1 interest paid was $16,000.
Home 2 avg outstanding balance was $1.4mm. Interest paid was $55,000.
What is the correct way to calculate my limit? Both properties were purchased after 2017, so limit is $750k.
Do you do properties individually? Or do I combine -- for example, combined Total Balance = $1.9mm (500k+1.4mm) -- divide this into the limit 750k gives 39%. Now, 39%*$71,000 (total interest paid) = $27,690., which is my max deductible amount.
