What interest payments can I deduct? (2011)
Whether or not you can deduct interest payments on a loan depends on what the loan is for and sometimes how the loan is secured. Here’s a list of what is deductible and where you take the deduction:
| You can deduct: | Report the deduction on this form or schedule: |
| 1. Interest on debts taken out for business operations |
Schedule C |
| 2. Interest on student loans (special rules and limits apply) |
Form 1040 (worksheet is provided in the instructions) |
| 3. Margin interest (up to the amount of interest, dividend and other investment income you have) |
Form 4952 |
| 4. Home mortgage interest on your primary residence |
Schedule A |
| 5. Home mortgage interest on your secondary residence or vacation home |
Schedule A |
| 6. Home equity loan interest (to the extent that the loan doesn’t exceed $100,000) |
Schedule A |
| 7. Interest on loans you take out to buy property to hold as an investment (such as land, securities, etc.) |
Form 4952 |
| 8. Points paid when you buy a house | Schedule A |
| 9. Points paid when you refinance your home loan (deducted ratably over the life of the loan) |
Schedule A |
| 10. Interest you pay on loans to purchase property that you rent to others |
Schedule E |
| 11. Interest on debts taken out for farming operations | Schedule F or Form 4835 |
| 12. Redeemable ground rent (lease payments made for the use of land) if the lease term is for more than 15 years and you meet certain other criteria |
Schedule A |
| 13. Construction loan interest where you use the proceeds to buy a building lot (provided you meet certain requirements) |
Schedule A |
| 14. Timeshare loan interest in which you own the property (fee simple or deeded) as a vacation home |
Schedule A |
| 15. Boat loan interest if the boat has basic living accommodations and serves as a vacation home |
Schedule A |
| 16. Mobile home loan interest if it serves as a vacation home |
Schedule A |
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