income taxes / mortgage

So you thinkk your mortgage is saving you on income taxes… think again

From my favorite financial guru, Jonathan Clements:

“Mortgage interest is tax deductible, but the tax savings are often less than we imagine—and there may be no tax savings at all. Suppose we’re married and our itemized deductions—including $13,000 in mortgage interest—total $26,000 in 2019. Sound impressive? Remember, we could always claim the $24,400 standard deduction for a couple filing jointly.”

“In other words, that $13,000 of mortgage interest is reducing our taxable income by a mere $1,600—and perhaps saving us just $352 in taxes, assuming we’re in the 22% federal income-tax bracket. The standard deduction was claimed by an estimated 88% of tax filers in 2018, which means these folks got no tax benefit from their itemized deductions, including any mortgage interest they paid.”

Check out his Humble Dollar website: https://humbledollar.com/
Source: Financial Planning for Women