The IRS is reversing course on the mortgage interest deduction for high value mortgages.
Some IRS auditors had taken the position that if acquisition debt on a home was more than $1 million, none of the interest on the amount in excess of $1 million could qualify as home equity debt. The IRS National Office has reversed this interpretation, saying that interest on an additional $100,000 can be deducted as home equity interest. This effectively allows homeowners to deduct interest on up to $1.1 million of their mortgages. Every little bit helps!
