No more deducting interest on your vacation home
A common question this last week from my tax clients was how the tax bill would affect their deductions for their secondary (vacation) home. The answer, as always, is it depends. If you own the house out right, under the new bill, you can still deduct property taxes, combined with your primary home, up to $10,000. If you have a mortgage you could be in trouble. The tax bill does not allow for the deduction of interest on secondary homes.
what about home equity?
Many homeowners use home equity loans to not only improve their primary residence, but sometimes, to purchase a vacation home. Under the current tax code, homeowners can deduct interest on home equity loans, up to $100,000 principal balance. The new bill does not allow for interest deductions at all.