|Written by C. L. Easey|
Interest that you pay on your home mortgage is tax deductible when the amount is itemized on your tax return. This means that the amount of interest that you pay each year is deducted for your income if this deduction is taken. One way that you can calculate the Home Mortgage Interest Deduction by using an online mortgage tax deduction calculator. You can also review â€śPublication 936â€ť that is available from the IRS.
Go to an online mortgage tax deduction calculator, such as the one available from Bankrate (see Resources).
Enter the amount of your mortgage in the Mortgage Amount field.
Enter the length of your mortgage in the Term field. The typical length of a standard mortgage is 30 years.
Enter the interest rate for your mortgage in the Interest rate field.
Enter your federal tax bracket in the Federal tax rate field. Your federal tax rate is based on the amount of income your earn.
Enter your state tax rate in the State tax rate field. Click the â€śCalculateâ€ť button to view the first year tax savings.
Click the â€śView Reportâ€ť button to view detailed results. A new browser window will open to display the detailed results.
The Closing costs information does not need to be entered to determine the mortgage tax deduction.
Bankrate: Mortgage tax deduction calculator - http://www.bankrate.com/calculators/mortgages/loan-tax-deduction-calculator.aspx