panhandledad wrote:
- quote -


Without more info it's unclear. You'll probably be able to deduct all of
the interest from the 1st. You may be limited to deducting only the
interest on $100k of the second, which you said is a HELOC. It depends
whether these debts are characterized as "acquisition indebtedness" or
not. From the horse's mouth - IRS publication 936, Home Mortgage
Interest Deduction, explains what's deductible - you can get it at
www.irs.gov

Either way your lender should be able to provide projections of these
interest numbers.

Also: keep in mind that your income of $245k means you're in the range
for phase-out of itemized deductions. So even if you can put it on
Schedule A, you won't get the full itemized deduction for this interest.
Here's a calculator that helps estimate the impact of this - enter all
your itemized deductions in the "subject to phase out" box (not just
interest but also property tax, state income tax - if any):
http://tax.cchgroup.com/taxcalcs/rat...ed/default.asp

-Tad

I have a question on the 2nd mortgage. Is this truely a equity loan?
They are limited in deductability to the interest on $100,000 if not
used to purchase the home itself or make improvements.

In article <1119403444.726786.250770[at]o13g2000cwo.googlegroups.com> ,
"panhandledad" <mccarthy.mike[at]gmail.com> wrote:

- quote -

Assuming this is your primary or 2nd home, all of the
mortgage interest is deductable. Since your loans are
new, all but about $100 will be interest to start with.
That means you will get about 1/3 of the interest you
pay back at tax time.

-john-

--
================================================== ====================
John A. Weeks III 952-432-2708 john[at]johnweeks.com
Newave Communications http://www.johnweeks.com
================================================== ====================

Tomorrow we sign our loan papers and I want to know how much of our
mortgage is deductible. The loan is a 30 year fixed with a 10 year
interest only option. Here is a breakdown of our mortgage:

1st: $562,250 [at] 6.25% -0 points $2928.39

2nd: 129,750 [at] 6.25% -0- points 675.78 (HELOC= PRIME = .25% =
6.25%, floating)

Total mortgage $3604.17


Our credit scores are 650 and 670 and we need to do a stated income
loan.


Our income combined is 245K a year.

Thanks