is the interest paid on the first and second mortgages tax deductible?
We have bought a new house and move in one month. We are
selling our current house and have had to apply for a bridge
loan in the event that the first house doesn't sell by the
closing on the second.
My questions:
1) is the interest paid on the first and second mortgages
tax deductible?
2) Is the interest paid on the bridge loan tax deductible?
3) Are the real estate taxes paid on both houses tax
deductible?
Yes to both, assuming that you have only these two
residences and you don't run afoul of the $1 million
debt limit.
Yes, subject to balance limitations ($1,000,000 for an
"acquisition loan" and $100,000 for a "non-acquistion loan".)
Yes, if secured by the house, and if you're not deducting
mortgage interest on a third (vacation) home.