# How much of my mortgage interest will i get back

Best Answer: Dear J: Your mortgage interest goes on Sch A and you probably will need more items to be able to use it. Property taxes, contributions, medical (over 7.5 % of AGI) state tax or sales tax are some of the items on Sch A.

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Precious little in most cases, and absolutely nothing in many cases. A few examples make this easier to understand.

First off, everyone gets the standard deduction if it's more than their itemized deductions. For a single taxpayer the SD is \$5,700. For a married couple it's \$11,400. At today's interest rates, that adds up to a LOT of mortgage before you start to benefit. True, you do get to deduct property taxes and a few other things like charitable donations and medical expenses (over 7.5% of your AGI) but for most folks the mortgage interest and property taxes are the biggies.

So, if you are single and pay \$5,500 in mortgage interest and \$900 in property taxes and have

no other itemized deductions, your total is \$6,400. The tax benefit is based upon the difference between your itemized deductions and the standard deduction. The difference here is \$700. If you're in a 15% tax bracket, you've saved a whopping \$105 in taxes. If your bracket is 25% the savings would be \$175. Expressed as a function of the actual interest that you paid, that's between 1.9% and 3.1% of the mortgage interest paid. Expressed as a function of the total of mortgage interest and property taxes, that drops to 1.6% and 2.7%

If you were married, using the same numbers as above, your tax savings would be exactly \$0 since your total itemized deductions are considerably less than standard deduction amount of \$11,400.

The tax benefits of home ownership are grossly over-hyped, especially by Realtors. I've heard them telling couples considering a modest \$150,000 home that they'd save \$5,000 in taxes when in reality at today's rates they'd probably not save a dime in taxes by buying a home.