Another big question coming from many clients regarding the new Act’s effect on their returns is about home ownership. Traditionally, tax law provides numerous incentives for home ownership by allowing the deduction for mortgage interest and real estate tax. The Tax Cuts and Jobs Act modifies these popular tax benefits.
Home mortgage interest is generally deductible if it is paid or accrued on acquisition indebtedness or home equity indebtedness secured by any qualified residence of the taxpayer (i.e., the taxpayer’s principal or second residence). The deduction for acquisition indebtedness is limited to interest paid.. Read More.