11 Mar Deducting interest on a home equity line of credit
Q. I have a small home equity line of credit that I used to pay off a car. I only had $350 in interest payments for the year, and the bank didn’t send me any tax forms. Can I still deduct the amount?
A. You sure can.
You will only receive a 1098 mortgage interest statement if you paid more than $600 in mortgage interest in 2014, said Gail Rosen, a Martinsville-based certified public accountant.
Rosen said the mortgage interest on an equity loan Is deductible even though you used the proceeds to pay off your car loan.
“The deduction for the interest is limited though to the lesser of $100,000 loan — $50,000 if your filing status is married filing separately — or your equity in the home,” she said.
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This post first appeared in March 2015.NJMoneyHelp.com presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.