The Tax Cut and Jobs Act provided many tax benefits and also created some hidden traps to avoid. One of these traps relates to the residential mortgage interest deduction. Prior to 2018 mortgage interest was deductible on residential debt up to $1,000,000. Beginning in 2018 mortgage interest is only deductible on residential mortgage debt up to $750,000. However, any mortgage interest incurred on debt originating prior to December 15, 2017 may be grandfathered in and the interest may still deductible up to the original $1,000,000. Therefore, this may need to be considered before making any decision that could extinguish the original grandfathered debt.
If you have any questions about your mortgage interest deduction, please contact Perry Barnett, CPA at (770) 287-7800 or email at firstname.lastname@example.org. Stay tuned for more tax tips or follow them on our social media accounts every #TaxTipTuesday!