4 ms·

10K limit on mortgage interest from primary residence , right ?

• jandrese 3y ago
  It's a $10k limit on deductions so dependents, charitable contributions, mortgage interest, and probably some more stuff has to stay under that cap or it doesn't count. Since that change went in we've never been able to even match the standard deduction. It increased our tax bill by about 2% and my wife has still never forgiven Trump. I think we are directly in the middle of "squeeze the middle class" part of that tax change.
  • gamblor956 3y ago
    That's simply wrong. The I.R.S. specifically notes that there is no limit on overall deductions, and hasn't been for years. https://www.irs.gov/newsroom/irs-provides-tax-inflation-adjustments-for-tax-year-2023#:~:text=For%202023%2C%20as%20in%202022,Tax%20Cuts%20and%20Jobs%20Act https://www.irs.gov/newsroom/irs-provides-tax-inflation-adju.... However, there are now limits on individual deductions that didn't previously exist, like the SALT cap of $10,000. It also appears you were affected by the cap on the (loan) value of homes which for which you could take the mortgage interest deduction, which was lowered to $750k from $1m by the TCJA (meaning, if your home is worth more than $750k for loan purposes you can only deduct the mortgage interest attributable to the first $750k of the loan), or by the elimination of a number of 2% items (items that pre-TCJA could be deducted only if they exceeded 2% of your AGI).
  • jandrese 3y ago
    My home is nowhere near $750k, not even half of that. But every tax filing solution I've used has capped me at $10k deductions ever since the change.