HELP / Someone explain mortgage interest right off Pleses?

Question

If I own a house I can right off the interest on the mortgage?
This goes against my federal government Tax bill ??

so lets say I have to pay $30,000 on my federal tax and I have a big mortgage on my home. In the first years of my mortgage payments it is all interest and it comes to $30,000 in interest, I can right that off (that means I don't pay tax!!!)
Is this right?

Answer 1

Nope. Not like that.

Let's say you earned $60,000 in income. And that you paid $15,000 in interest.

Instead of being taxed on the whole $60K, you'd only pay tax on $45K, having deducted (or written off) the $15K in paid interest.

The way you described it, only works on those very few items that are actually tax CREDITS. Like getting $1000 per child, deducted from your actual tax amount, not your income amount.

Answer 2

Uh, no that's not right. Mortgage interest is an itemized deduction, not a credit. That means that at most you get a percentage of the interest paid off your taxes, the percent of your tax bracket - at most that would be 35% of your deductions. A deduction is subtracted from your income before your tax is figured, not from your tax.

Also, if your tax is that high, you are probably paying AMT which can cut the value of deductions.

Answer 3

http://www.lendermark.com/mortgage_tax_advantages.htm