Publication 936

Cat. No. 10426G Contents

Home
Reminders . . . . . . . . . . . . . . . . . . . 1
Department
of the Introduction . . . . . . . . . . . . . . . . . . 2

Mortgage
Treasury
Internal Part I. Home Mortgage Interest . . . . . . 2
Revenue Secured Debt . . . . . . . . . . . . . . . 3
Service
Interest Qualified Home . . . . . . . .
Special Situations . . . . . .
Points . . . . . . . . . . . . .
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4
5

Deduction Form 1098, Mortgage Interest

Statement . . . . . . . . .
How To Report . . . . . . . .
...... 8
...... 8
Special Rule for
Tenant-Stockholders in
Cooperative Housing
For use in preparing Corporations . . . . . . . ...... 8

2023 Returns Part II. Limits on Home Mortgage

Interest Deduction . . . . . . ..... 9
Home Acquisition Debt . . . . ..... 9
Grandfathered Debt . . . . . . . . . . 10
Worksheet To Figure Your
Qualified Loan Limit and
Deductible Home Mortgage
Interest for the Current Year . . . . 11

How To Get Tax Help . . . . . . . . . . . . 14

Index . . . . . . . . . . . . . . . . . . . . . 17

Reminders
Mortgage insurance premiums. The item-
ized deduction for mortgage insurance premi-
ums has expired. You can no longer claim the
deduction.
Home equity loan interest. No matter when
the indebtedness was incurred, you can no lon-
ger deduct the interest from a loan secured by
your home to the extent the loan proceeds
weren't used to buy, build, or substantially im-
prove your home.
Home mortgage interest. You can deduct
home mortgage interest on the first $750,000
($375,000 if married filing separately) of indebt-
edness. However, higher limitations ($1 million
($500,000 if married filing separately)) apply if
you are deducting mortgage interest from in-
debtedness incurred before December 16,
2017.
Future developments. For the latest informa-
tion about developments related to Pub. 936,
such as legislation enacted after it was pub-
lished, go to IRS.gov/Pub936.
Photographs of missing children. The IRS is
a proud partner with the National Center for
Missing & Exploited Children® (NCMEC). Pho-
tographs of missing children selected by the
Center may appear in this publication on pages
that would otherwise be blank. You can help
bring these children home by looking at the
photographs and calling 1-800-THE-LOST
(1-800-843-5678) if you recognize a child.
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Nov 30, 2023

 Useful Items How much you can deduct depends on the date
Introduction You may want to see: of the mortgage, the amount of the mortgage,
and how you use the mortgage proceeds.
This publication discusses the rules for deduct-
Publication If all of your mortgages fit into one or more of
ing home mortgage interest.
the following three categories at all times during
Part I contains general information on home 504 Divorced or Separated Individuals the year, you can deduct all of the interest on
mortgage interest, including points. It also ex-
504

523 Selling Your Home those mortgages. (If any one mortgage fits into
plains how to report deductible interest on your
more than one category, add the debt that fits in
523

tax return.
527 Residential Rental Property each category to your other debt in the same
Part II explains how your deduction for home
527

category.) If one or more of your mortgages

mortgage interest may be limited. It contains Ta- 530 Tax Information for Homeowners
doesn’t fit into any of these categories, use Part
530

ble 1, which is a worksheet you can use to fig-

II of this publication to figure the amount of inter-
ure the limit on your deduction. See How To Get Tax Help at the end of this pub- est you can deduct.
lication for information about getting these pub- The three categories are as follows.
Comments and suggestions. We welcome lications.
your comments about this publication and sug- 1. Mortgages you took out on or before Octo-
gestions for future editions. ber 13, 1987 (called grandfathered debt).
You can send us comments through
IRS.gov/FormComments. Or, you can write to
Part I. Home 2. Mortgages you (or your spouse if married
the Internal Revenue Service, Tax Forms and Mortgage Interest filing a joint return) took out after October
13, 1987, and prior to December 16, 2017
Publications, 1111 Constitution Ave. NW,
IR-6526, Washington, DC 20224. (see binding contract exception below), to
This part explains what you can deduct as buy, build, or substantially improve your
Although we can’t respond individually to home mortgage interest. It includes discussions home (called home acquisition debt), but
each comment received, we do appreciate your on points and how to report deductible interest only if throughout 2023 these mortgages
feedback and will consider your comments and on your tax return. plus any grandfathered debt totaled $1
suggestions as we revise our tax forms, instruc-
Generally, home mortgage interest is any in- million or less ($500,000 or less if married
tions, and publications. Don’t send tax ques-
terest you pay on a loan secured by your home filing separately).
tions, tax returns, or payments to the above ad-
(main home or a second home). The loan may Exception. A taxpayer who enters into
dress.
be a mortgage to buy your home, or a second a written binding contract before Decem-
Getting answers to your tax questions. mortgage. ber 15, 2017, to close on the purchase of
If you have a tax question not answered by this a principal residence before January 1,
publication or the How To Get Tax Help section You can’t deduct home mortgage interest 2018, and who purchases such residence
at the end of this publication, go to the IRS In- unless the following conditions are met. before April 1, 2018, is considered to have
teractive Tax Assistant page at IRS.gov/ • You file Form 1040 or 1040-SR and itemize incurred the home acquisition debt prior to
Help/ITA where you can find topics by using the deductions on Schedule A (Form 1040). December 16, 2017.
search feature or viewing the categories listed. • The mortgage is a secured debt on a quali- 3. Mortgages you (or your spouse if married
fied home in which you have an ownership
Getting tax forms, instructions, and pub- filing a joint return) took out after Decem-
interest. Secured Debt and Qualified Home
lications. Go to IRS.gov/Forms to download ber 15, 2017, to buy, build, or substantially
are explained later.
current and prior-year forms, instructions, and improve your home (called home acquisi-
publications. Both you and the lender must intend that the tion debt), but only if throughout 2023
loan be repaid. these mortgages plus any grandfathered
Ordering tax forms, instructions, and debt totaled $750,000 or less ($375,000 or
publications. Go to IRS.gov/OrderForms to or- Note. Interest on home equity loans and less if married filing separately).
der current forms, instructions, and publica- lines of credit are deductible only if the bor-
tions; call 800-829-3676 to order prior-year rowed funds are used to buy, build, or substan- The dollar limits for the second and third cate-
forms and instructions. The IRS will process tially improve the taxpayer’s home that secures gories apply to the combined mortgages on
your order for forms and publications as soon the loan. The loan must be secured by the tax- your main home and second home.
as possible. Don’t resubmit requests you’ve al- payer’s main home or second home (qualified See Part II for more detailed definitions of
ready sent us. You can get forms and publica- residence), and meet other requirements. grandfathered debt and home acquisition debt.
tions faster online. You can use Figure A to check whether your
Fully deductible interest. In most cases, you home mortgage interest is fully deductible.
can deduct all of your home mortgage interest.

2 Publication 936 (2023)

 Figure A. Is My Home Mortgage Interest Fully Deductible?
(Instructions: Include balances of ALL mortgages secured by your main home and second home.)

Start Here:

Do you meet the conditions1 to deduct home You can’t deduct the interest payments as home
No mortgage interest. 2
mortgage interest?

Yes

Yes
Were all of your home mortgages taken out Your home mortgage interest is fully deductible. You
on or before October 13, 1987? don’t need to read Part II of this publication.

No

Were all of your home mortgages taken out after

October 13, 1987, used to buy, build, or substantially No Go to Part II of this publication to determine the
improve the main home secured by that main home limits on your deductible home mortgage interest.
mortgage or used to buy, build, or substantially
improve the second home secured by that second
home mortgage, or both?

Yes

Were your (or your spouse’s if married filing a joint Were your (or your spouse’s if married filing a joint
return) mortgage balances $750,000 or less return) grandfathered debt plus home acquisition
($375,000 or less if married filing separately) No debt balances $750,000 or less4 ($375,000 or less if No
(or $1 million or less ($500,000 if married filing married filing separately) (or $1 million or less
separately) if all debt was incurred prior to ($500,000 if married filing separately) if all debt was
December 16, 2017) at all times during the year? 3 incurred prior to December 16, 2017) at all times
during the year? 3
Yes
Yes

1 You must itemize deductions on Schedule A (Form 1040). The loan must be a secured debt on a qualified home. See Part I, Home Mortgage Interest, earlier.
2 See Table 2 in Part II of this publication for where to deduct other types of interest payments.
3 A taxpayer who enters into a written binding contract before December 15, 2017, to close on the purchase of a principal residence before January 1, 2018,
and who purchases such residence before April 1, 2018, is considered to have incurred the home acquisition debt prior to December 16, 2017, and may use
the 2017 threshold amounts of $1,000,000 ($500,000 for married filing separately).
4
See Part II of this publication for more information about grandfathered debt and home acquisition debt.

Secured Debt • Is recorded or is otherwise perfected under cause of a lien on your general assets or if it is a
any state or local law that applies. security interest that attaches to the property
You can deduct your home mortgage interest without your consent (such as a mechanic's lien
In other words, your mortgage is a secured
only if your mortgage is a secured debt. A se- or judgment lien).
debt if you put your home up as collateral to
cured debt is one in which you sign an instru- A debt isn’t secured by your home if it once
protect the interests of the lender. If you can't
ment (such as a mortgage, deed of trust, or was, but is no longer secured by your home.
pay the debt, your home can then serve as pay-
land contract) that: ment to the lender to satisfy (pay) the debt. In Wraparound mortgage. This isn’t a se-
• Makes your ownership in a qualified home this publication, mortgage will refer to secured cured debt unless it is recorded or otherwise
security for payment of the debt; debt. perfected under state law.
• Provides, in case of default, that your home
could satisfy the debt; and Debt not secured by home. A debt isn’t se-
cured by your home if it is secured solely be-

Publication 936 (2023) 3

 Example. Ari owns a home subject to a home. For information on residential rental You can continue treating a destroyed home
mortgage of $40,000. Ari sells the home for property, see Pub. 527. as a qualified home if, within a reasonable pe-
$100,000 to Palmer, who takes it subject to the riod of time after the home is destroyed, you:
$40,000 mortgage. Ari continues to make the More than one second home. If you have • Rebuild the destroyed home and move into
payments on the $40,000 note. Palmer pays more than one second home, you can treat only it, or
$10,000 down and gives Ari a $90,000 note se- one as the qualified second home during any • Sell the land on which the home was loca-
cured by a wraparound mortgage on the home. year. However, you can change the home you ted.
Ari doesn't record or otherwise perfect the treat as a second home during the year in the
following situations. This rule applies to your main home and to a
$90,000 mortgage under the state law that ap-
• If you get a new home during the year, you second home that you treat as a qualified home.
plies. Therefore, the mortgage isn't a secured
debt and Palmer can't deduct any of the interest can choose to treat the new home as your
second home as of the day you buy it. Time-sharing arrangements. You can treat a
paid on it as home mortgage interest. home you own under a time-sharing plan as a
• If your main home no longer qualifies as
your main home, you can choose to treat it qualified home if it meets all the requirements. A
Choice to treat the debt as not secured by
as your second home as of the day you time-sharing plan is an arrangement between
your home. You can choose to treat any debt
stop using it as your main home. two or more people that limits each person's in-
secured by your qualified home as not secured
• If your second home is sold during the year terest in the home or right to use it to a certain
by the home. This treatment begins with the tax
or becomes your main home, you can part of the year.
year for which you make the choice and contin-
ues for all later tax years. You can revoke your choose a new second home as of the day Rental of time-share. If you rent out your
choice only with the consent of the IRS. you sell the old one or begin using it as time-share, it qualifies as a second home only if
your main home. you also use it as a home during the year. See
You may want to treat a debt as not secured
by your home if the interest on that debt is fully Second home rented out, earlier, for the use re-
Divided use of your home. The only part of
deductible (for example, as a business ex- quirement. To know whether you meet that re-
your home that is considered a qualified home
pense) whether or not it qualifies as home mort- quirement, count your days of use and rental of
is the part you use for residential living. If you
gage interest. This may allow you, if the limits in the home only during the time you have a right
use part of your home for other than residential
Part II apply, more of a deduction for interest on to use it or to receive any benefits from the
living, such as a home office, you must allocate
other debts that are deductible only as home rental of it.
the use of your home. You must then divide both
mortgage interest.
the cost and fair market value of your home be- Married taxpayers. If you're married and file a
tween the part that is a qualified home and the joint return, your qualified home(s) can be
Cooperative apartment owner. If you own
part that isn't. Dividing the cost may affect the owned either jointly or by only one spouse.
stock in a cooperative housing corporation, see
amount of your home acquisition debt, which is
the Special Rule for Tenant-Stockholders in Co-
limited to the cost of your home plus the cost of Separate returns. If you're married filing
operative Housing Corporations near the end of
any improvements. (See Home Acquisition Debt separately and you and your spouse own more
this Part I.
in Part II, later.) than one home, you can each take into account
only one home as a qualified home. However, if
Qualified Home Renting out part of home. If you rent out you both consent in writing, then one spouse
part of a qualified home to another person (ten- can take both the main home and a second
ant), you can treat the rented part as being used home into account.
For you to take a home mortgage interest de- by you for residential living only if all of the fol-
duction, your debt must be secured by a quali- lowing conditions apply.
fied home. This means your main home or your
• The rented part of your home is used by Special Situations
second home. A home includes a house, con- the tenant primarily for residential living.
dominium, cooperative, mobile home, house This section describes certain items that can be
• The rented part of your home isn't a
trailer, boat, or similar property that has sleep- included as home mortgage interest and others
self-contained residential unit having sepa-
ing, cooking, and toilet facilities. that can't. It also describes certain special situa-
rate sleeping, cooking, and toilet facilities.
• You don't rent (directly or by sublease) the tions that may affect your deduction.
The interest you pay on a mortgage on a
same or different parts of your home to
home other than your main or second home Late payment charge on mortgage pay-
more than two tenants at any time during
may be deductible if the proceeds of the loan ment. You can deduct as home mortgage inter-
the tax year. If two persons (and depend-
were used for business, investment, or other est a late payment charge if it wasn't for a spe-
ents of either) share the same sleeping
deductible purposes. Otherwise, it is consid- cific service performed in connection with your
quarters, they are treated as one tenant.
ered personal interest and isn't deductible. mortgage loan.
Office in home. If you have an office in
Main home. You can have only one main home your home that you use in your business, see Mortgage prepayment penalty. If you pay off
at any one time. This is the home where you or- Pub. 587, Business Use of Your Home. It ex- your home mortgage early, you may have to pay
dinarily live most of the time. plains how to figure your deduction for the busi- a penalty. You can deduct that penalty as home
ness use of your home, which includes the busi- mortgage interest provided the penalty isn't for
Second home. A second home is a home that ness part of your home mortgage interest. a specific service performed or cost incurred in
you choose to treat as your second home. connection with your mortgage loan.
Home under construction. You can treat a
Second home not rented out. If you have
home under construction as a qualified home Sale of home. If you sell your home, you can
a second home that you don’t hold out for rent
for a period of up to 24 months, but only if it be- deduct your home mortgage interest (subject to
or resale to others at any time during the year,
comes your qualified home at the time it is any limits that apply) paid up to, but not includ-
you can treat it as a qualified home. You don't
ready for occupancy. ing, the date of the sale.
have to use the home during the year.
The 24-month period can start any time on
Second home rented out. If you have a or after the day construction begins. Example. Sasha and Harper Smith sold
second home and rent it out part of the year, their home on May 7. Through April 30, they
you must also use it as a home during the year Home destroyed. You may be able to continue made home mortgage interest payments of
for it to be a qualified home. You must use this treating your home as a qualified home even af- $1,220. The settlement sheet for the sale of the
home more than 14 days or more than 10% of ter it is destroyed in a fire, storm, tornado, earth- home showed $50 interest for the 6-day period
the number of days during the year that the quake, or other casualty. This means you can in May up to, but not including, the date of sale.
home is rented at a fair rental, whichever is lon- continue to deduct the interest you pay on your Their mortgage interest deduction is $1,270
ger. If you don't use the home long enough, it is home mortgage, subject to the limits described ($1,220 + $50).
considered rental property and not a second in this publication.

4 Publication 936 (2023)

Prepaid interest. If you pay interest in ad- ments for jointly owned home under Alimony in that reduced your tax in the earlier year. This is
vance for a period that goes beyond the end of Pub. 504, Divorced or Separated Individuals. true whether the interest overcharge was refun-
the tax year, you must spread this interest over ded to you or was used to reduce the outstand-
the tax years to which it applies. You can deduct Redeemable ground rents. In some states ing principal on your mortgage. If you need to
in each year only the interest that qualifies as (such as Maryland), you can buy your home include the refund in income, report it on Sched-
home mortgage interest for that year. However, subject to a ground rent. A ground rent is an ob- ule 1 (Form 1040), line 8z.
there is an exception that applies to points, dis- ligation you assume to pay a fixed amount per If you received a refund of interest you over-
cussed later. year on the property. Under this arrangement, paid in an earlier year, you will generally receive
you're leasing (rather than buying) the land on a Form 1098, Mortgage Interest Statement,
Mortgage interest credit. You may be able to which your home is located. showing the refund in box 4. For information
claim a mortgage interest credit if you were is- If you make annual or periodic rental pay- about Form 1098, see Form 1098, Mortgage In-
sued a mortgage credit certificate (MCC) by a ments on a redeemable ground rent, you can terest Statement, later.
state or local government. Figure the credit on deduct them as mortgage interest. For more information on how to treat refunds
Form 8396, Mortgage Interest Credit. If you take A ground rent is a redeemable ground rent if of interest deducted in earlier years, see Recov-
this credit, you must reduce your mortgage in- all of the following are true. eries in Pub. 525, Taxable and Nontaxable In-
terest deduction by the amount of the credit. • Your lease, including renewal periods, is for come.
See Form 8396 and Pub. 530 for more infor- more than 15 years.
mation on the mortgage interest credit. • You can freely assign the lease. SBA disaster home loans. Interest paid on
• You have a present or future right (under disaster home loans from the Small Business
Ministers' and military housing allowance. state or local law) to end the lease and buy Administration (SBA) is deductible as mortgage
If you're a minister or a member of the uni- the lessor's entire interest in the land by interest if the requirements discussed earlier
formed services and receive a housing allow- paying a specific amount. under Home Mortgage Interest are met.
ance that isn't taxable, you can still deduct your • The lessor's interest in the land is primarily
home mortgage interest. For more information, a security interest to protect the rental pay-
see Pub. 3 (military) or Pub. 517 (ministers). ments to which he or she is entitled.
Points
Mortgage assistance payments under sec- Payments made to end the lease and to buy The term “points” is used to describe certain
tion 235 of the National Housing Act. If you the lessor's entire interest in the land aren't de- charges paid, or treated as paid, by a borrower
qualify for mortgage assistance payments for ductible as mortgage interest. to obtain a home mortgage. Points may also be
lower-income families under section 235 of the called loan origination fees, maximum loan
Nonredeemable ground rents. Payments charges, loan discount, or discount points.
National Housing Act, part or all of the interest on a nonredeemable ground rent aren't mort-
on your mortgage may be paid for you. You gage interest. You can deduct them as rent if A borrower is treated as paying any points
can't deduct the interest that is paid for you. they are a business expense or if they are for that a home seller pays for the borrower's mort-
rental property. gage. See Points paid by the seller, later.
No other effect on taxes. Don’t include
these mortgage assistance payments in your in-
come. Also, don't use these payments to reduce Reverse mortgages. A reverse mortgage is a General Rule
loan where the lender pays you (in a lump sum,
other deductions, such as real estate taxes.
a monthly advance, a line of credit, or a combi- You generally can't deduct the full amount of
Homeowner Assistance Fund. The Home- nation of all three) while you continue to live in points in the year paid. Because they are pre-
owner Assistance Fund program (HAF) was es- your home. With a reverse mortgage, you retain paid interest, you generally deduct them ratably
tablished to provide financial assistance to eligi- title to your home. Depending on the plan, your over the life (term) of the mortgage. See Deduc-
ble homeowners for purposes of paying certain reverse mortgage becomes due, with interest, tion Allowed Ratably next. If the loan is a home
expenses related to their principal residence to when you move, sell your home, reach the end equity, line of credit, or credit card loan and the
prevent mortgage delinquencies, defaults, fore- of a pre-selected loan period, or die. Because proceeds from the loan are not used to buy,
closures, loss of utilities or home energy serv- reverse mortgages are considered loan advan- build, or substantially improve the home, the
ices, and also displacements of homeowners ces and not income, the amount you receive points are not deductible.
experiencing financial hardship after January isn't taxable. Generally, any interest (including
21, 2020. If you are a homeowner who received original issue discount) accrued on a reverse For exceptions to the general rule, see De-
assistance under the HAF, the payments from mortgage is considered interest on home equity duction Allowed in Year Paid, later.
the HAF program are not considered income to debt and isn’t deductible.
you and you cannot take a deduction or credit
Rental payments. If you live in a house before
Deduction Allowed Ratably
for expenditures paid from the HAF program.
final settlement on the purchase, any payments
See sections on State and Local Real Estate If you don't meet the tests listed under Deduc-
you make for that period are rent and not inter-
Taxes and Home Mortgage Interest, in Pub. tion Allowed in Year Paid, later, the loan isn't a
est. This is true even if the settlement papers
530, to determine whether you meet the rules to home improvement loan, or you choose not to
call them interest. You can't deduct these pay-
deduct all of the mortgage interest on your loan deduct your points in full in the year paid, you
ments as home mortgage interest.
and all of the real estate taxes on your main can deduct the points ratably (equally) over the
home. For more details about the HAF program, life of the loan if you meet all of the following
Mortgage proceeds invested in tax-exempt
see Homeowner Assistance Fund in Pub. 530. If tests.
securities. You can't deduct the home mort-
you received HAF funds from an Indian Tribal 1. You use the cash method of accounting.
gage interest on grandfathered debt if you used
Government or an Alaska Native Corporation This means you report income in the year
the proceeds of the mortgage to buy securities
and wish more details about the HAF program, you receive it and deduct expenses in the
or certificates that produce tax-free income.
see FAQs for Payments by Indian Tribal year you pay them. Most individuals use
“Grandfathered debt” is defined in Part II of this
Governments and Alaska Native Corporations this method.
publication.
to Individuals Under COVID-Relief Legislation.
2. Your loan is secured by a home. (The
Refunds of interest. If you receive a refund of
Divorced or separated individuals. If a quali- home doesn't need to be your main
interest in the same tax year you paid it, you
fied pre-2019 divorce or separation agreement home.)
must reduce your interest expense by the
requires you to pay home mortgage interest on 3. Your loan period isn't more than 30 years.
amount refunded to you. If you receive a refund
a home owned by your spouse or former of interest you deducted in an earlier year, you 4. If your loan period is more than 10 years,
spouse or by both of you, the payment of inter- must generally include the refund in income in the terms of your loan are the same as
est may be alimony. See the discussion of Pay- the year you receive it. However, you need to in- other loans offered in your area for the
clude it only up to the amount of the deduction same or longer period.

Publication 936 (2023) 5

 Figure B. Are My Points Fully Deductible This Year?

Start Here:

No
Is the loan secured by your main home?

Yes

Is the payment of points an established No

business practice in your area?

Yes

Were the points paid more than the Yes

amount generally charged in your area?

No

Do you use the cash method of No

accounting?

Yes

Were the points paid in place of Yes

amounts that ordinarily are separately
stated on the settlement sheet?

No

Were the funds you provided (other than

those you borrowed from your lender or No
mortgage broker), plus any points the
seller paid, at least as much as the points
charged?*

Yes

Yes Did you take out the loan to substantially

improve your main home?

No

Did you take out the loan to buy or build No

your main home?

Yes

Were the points figured as a percentage No

of the principal amount of the mortgage?

Yes

Is the amount paid clearly shown as No

points on the settlement statement?

Yes

You can fully deduct the points this year You cannot fully deduct the points this
on Schedule A (Form 1040). year. See the discussion on Points,
earlier.

* The funds you provided are not required to have been applied to the points. They can include a down payment, an escrow deposit, earnest money, and other
funds you paid at or before closing for any purpose.

6 Publication 936 (2023)

 5. Either your loan amount is $250,000 or Home improvement loan. You can also fully Original issue discount. If you don't qualify to
less, or the number of points isn't more deduct in the year paid points paid on a loan to either deduct the points in the year paid or de-
than: substantially improve your main home if tests 1 duct them ratably over the life of the loan, or if
through 6 are met. you choose not to use either of these methods,
a. 4, if your loan period is 15 years or
the points reduce the issue price of the loan.
less; or Second home. You can't fully deduct
This reduction results in original issue discount.
! in the year paid points you pay on loans
b. 6, if your loan period is more than 15
CAUTION secured by your second home. You can
years. Amounts charged for services. Amounts
deduct these points only over the life of the charged by the lender for specific services con-
loan.
Example. You use the cash method of ac- nected to the loan aren't interest. Examples of
counting. In 2023, you took out a $100,000 these charges are:
home mortgage loan payable over 20 years. Refinancing. Generally, points you pay to refi- • Appraisal fees,
The terms of the loan are the same as for other nance a mortgage aren't deductible in full in the • Department of Veterans Affairs (VA) fund-
20-year loans offered in your area. You paid year you pay them. This is true even if the new ing fees,
$4,800 in points. You made 3 monthly payments mortgage is secured by your main home. • Mortgage insurance premiums,
on the loan in 2023. You can deduct $60 However, if you use part of the refinanced • Notary fees, and
[($4,800 ÷ 240 months) x 3 payments] in 2023. mortgage proceeds to substantially improve • Preparation costs for the mortgage note or
In 2024, if you make all twelve payments, you your main home and you meet the first six tests deed of trust.
will be able to deduct $240 ($20 x 12). listed under Deduction Allowed in Year Paid, You can't deduct these amounts as points either
earlier, you can fully deduct the part of the in the year paid or over the life of the mortgage.
Deduction Allowed in Year Paid points related to the improvement in the year
you paid them with your own funds. You can de- Points paid by the seller. The term “points”
You can fully deduct points in the year paid if duct the rest of the points over the life of the includes loan placement fees that the seller
you meet all the following tests. (You can use loan. pays to the lender to arrange financing for the
Figure B as a quick guide to see whether your buyer.
points are fully deductible in the year paid.) Example 1. In 1999, you got a mortgage to
buy a home. In 2023, you refinanced that mort- Treatment by seller. The seller can't de-
1. Your loan is secured by your main home. gage with a 15-year $100,000 mortgage loan. duct these fees as interest. But they are a sell-
(Your main home is the one you ordinarily The mortgage is secured by your home. To get ing expense that reduces the amount realized
live in most of the time.) the new loan, you had to pay three points by the seller. See Pub. 523 for information on
2. Paying points is an established business ($3,000). Two points ($2,000) were for prepaid selling your home.
practice in the area where the loan was interest, and one point ($1,000) was charged for
services, in place of amounts that are ordinarily Treatment by buyer. The buyer reduces
made. the basis of the home by the amount of the
stated separately on the settlement statement.
3. The points paid weren't more than the You paid the points out of your private funds, seller-paid points and treats the points as if he
points generally charged in that area. rather than out of the proceeds of the new loan. or she had paid them. If all the tests under De-
The payment of points is an established prac- duction Allowed in Year Paid, earlier, are met,
4. You use the cash method of accounting. the buyer can deduct the points in the year paid.
This means you report income in the year tice in the area, and the points charged aren't
more than the amount generally charged there. If any of those tests aren't met, the buyer de-
you receive it and deduct expenses in the ducts the points over the life of the loan.
year you pay them. Most individuals use Your first payment on the new loan was due July
1. You made six payments on the loan in 2023 If you need information about the basis of
this method. your home, see Pub. 523 or Pub. 530.
and are a cash basis taxpayer.
5. The points weren't paid in place of You used the funds from the new mortgage
amounts that are ordinarily stated sepa- Funds provided are less than points. If you
to repay your existing mortgage. Although the
rately on the settlement statement, such meet all the tests in Deduction Allowed in Year
new mortgage loan was for your continued own-
as appraisal fees, inspection fees, title Paid, earlier, except that the funds you provided
ership of your main home, it wasn't for the pur-
fees, attorney fees, and property taxes. were less than the points charged to you (test 6,
chase or substantial improvement of that home.
earlier), you can deduct the points in the year
6. The funds you provided at or before clos- You can't deduct all of the points in 2023. You
paid, up to the amount of funds you provided. In
ing, plus any points the seller paid, were at can deduct two points ($2,000) ratably over the
addition, you can deduct any points paid by the
least as much as the points charged. The life of the loan. You deduct $67 [($2,000 ÷ 180
seller.
funds you provided aren't required to have months) × 6 payments] of the points in 2023.
been applied to the points. They can in- The other point ($1,000) was a fee for services
Example 1. When you took out a $100,000
clude a down payment, an escrow deposit, and isn't deductible.
mortgage loan to buy your home in December,
earnest money, and other funds you paid you were charged one point ($1,000). You meet
at or before closing for any purpose. You Example 2. The facts are the same as in
all the tests for deducting points in the year
can't have borrowed these funds from your Example 1, except that you used $25,000 of the
paid, except the only funds you provided were a
lender or mortgage broker. loan proceeds to substantially improve your
$750 down payment. Of the $1,000 charged for
home and $75,000 to repay your existing mort-
7. You use your loan to buy or build your points, you can deduct $750 in the year paid.
gage. You deduct 25% ($25,000 ÷ $100,000) of
main home. You spread the remaining $250 over the life of
the points ($2,000) in 2023. Your deduction is
the mortgage.
8. The points were figured as a percentage $500 ($2,000 × 25% (0.25)).
of the principal amount of the mortgage. You also deduct the ratable part of the re-
Example 2. The facts are the same as in
maining $1,500 ($2,000 − $500) that must be
9. The amount is clearly shown on the settle- Example 1, except that the person who sold you
spread over the life of the loan. This is $50
ment statement (such as the Settlement your home also paid one point ($1,000) to help
[($1,500 ÷ 180 months) × 6 payments] in 2023.
Statement, Form HUD-1) as points you get your mortgage. In the year paid, you
The total amount you deduct in 2023 is $550
charged for the mortgage. The points may can deduct $1,750 ($750 of the amount you
($500 + $50).
be shown as paid from either your funds or were charged plus the $1,000 paid by the
the seller's. seller). You spread the remaining $250 over the
Special Situations life of the mortgage. You must reduce the basis
Note. If you meet all of these tests, you can of your home by the $1,000 paid by the seller.
This section describes certain special situations
choose to either fully deduct the points in the
that may affect your deduction of points. Excess points. If you meet all the tests in De-
year paid, or deduct them over the life of the
loan. duction Allowed in Year Paid, earlier, except that
the points paid were more than generally paid in

Publication 936 (2023) 7

your area (test 3), you deduct in the year paid also be deductible, either in the year paid or Similarly, if you're the payer of record on a
only the points that are generally charged. You over the life of the loan. See the earlier discus- mortgage on which there are other borrowers
must spread any additional points over the life sion of Points to determine whether you can de- entitled to a deduction for the interest shown on
of the mortgage. duct points not shown on Form 1098. the Form 1098 you received, deduct only your
share of the interest on Schedule A (Form
Mortgage ending early. If you spread your de- Prepaid interest on Form 1098. If you pre- 1040), line 8a. Let each of the other borrowers
duction for points over the life of the mortgage, paid interest in 2023 that accrued in full by Jan- know what their share is.
you can deduct any remaining balance in the uary 15, 2024, this prepaid interest may be in-
year the mortgage ends. However, if you refi- cluded in box 1 of Form 1098. However, you Mortgage proceeds used for business or in-
nance the mortgage with the same lender, you can't deduct the prepaid amount for January vestment. If your home mortgage interest de-
can't deduct any remaining balance of spread 2024 in 2023. (See Prepaid interest, earlier.) duction is limited under the rules explained in
points. Instead, deduct the remaining balance You will have to figure the interest that accrued Part II, but all or part of the mortgage proceeds
over the term of the new loan. for 2024 and subtract it from the amount in were used for business, investment, or other
A mortgage may end early due to a prepay- box 1. You will include the interest for January deductible activities, see Table 2 near the end
ment, refinancing, foreclosure, or similar event. 2024 with other interest you pay for 2024. of this publication. It shows where to deduct the
part of your excess interest that is for those ac-
Example. You paid $3,000 in points in 2012 Refunded interest. If you received a refund of tivities. The Table 1 Instructions for line 16 in
that you had to spread out over the 15-year life mortgage interest you overpaid in an earlier Part II explain how to divide the excess interest
of the mortgage. You deduct $200 points per year, you will generally receive a Form 1098 among the activities for which the mortgage
year. Through 2023, you have deducted $2,200 showing the refund in box 4. See Refunds of in- proceeds were used.
of the points. terest, earlier.
You prepaid your mortgage in full in 2023.
Special Rule for
You can deduct the remaining $800 of points in
2023.
How To Report Tenant-Stockholders in
Cooperative Housing
Generally, you can deduct the home mortgage
Limits on deduction. You can't fully deduct
interest and points reported to you on Form Corporations
points paid on a mortgage that exceeds the lim-
its discussed in Part II. See the Table 1 Instruc- 1098 on Schedule A (Form 1040), line 8a. How-
A qualified home includes stock in a coopera-
tions, later, for line 13. ever, any interest showing in box 1 of Form
tive housing corporation owned by a ten-
1098 from a home equity loan, or a line of credit
ant-stockholder. This applies only if the ten-
Form 1098. The mortgage interest statement or credit card loan secured by the property, is
ant-stockholder is entitled to live in the house or
you receive should show not only the total inter- not deductible if the proceeds were not used to
apartment because of owning stock in the co-
est paid during the year, but also your mortgage buy, build, or substantially improve a qualified
operative.
insurance premiums and deductible points paid home. If you paid more deductible interest to
during the year. See Form 1098, Mortgage In- the financial institution than the amount shown
Cooperative housing corporation. This is a
terest Statement, later. on Form 1098, show the portion of the deducti-
corporation that meets all of the following condi-
ble interest that was omitted from Form 1098 on
tions.
line 8b. Attach a statement to your paper return
Form 1098, Mortgage explaining the difference and print “See at- 1. Has only one class of stock outstanding.
Interest Statement tached” next to line 8b.
2. Has no stockholders other than those that
Deduct home mortgage interest that wasn't own the stock who can live in a house,
If you paid $600 or more of mortgage interest
reported to you on Form 1098 on Schedule A apartment, or house trailer owned or
(including certain points) during the year on any
(Form 1040), line 8b. If you paid home mort- leased by the corporation.
one mortgage, you will generally receive a Form
1098 or a similar statement from the mortgage gage interest to the person from whom you 3. Has no stockholders who can receive any
holder. You will receive the statement if you pay bought your home, show that person's name, distribution out of capital other than on a
interest to a person (including a financial institu- address, and taxpayer identification number liquidation of the corporation.
tion or cooperative housing corporation) in the (TIN) on the dotted lines next to line 8b. The
seller must give you this number and you must 4. Meets at least one of the following require-
course of that person's trade or business. A
give the seller your TIN. A Form W-9, Request ments.
governmental unit is a person for purposes of
furnishing the statement. for Taxpayer Identification Number and Certifi- a. Receives at least 80% of its gross in-
cation, can be used for this purpose. Failure to come for the year in which the mort-
The statement for each year should be sent meet any of these requirements may result in a gage interest is paid or incurred from
to you by January 31 of the following year. A $50 penalty for each failure. The TIN can be ei- tenant-stockholders. For this purpose,
copy of this form will also be sent to the IRS. ther a social security number, an individual tax- gross income is all income received
The statement will show the total interest payer identification number (issued by the IRS), during the entire year, including
you paid during the year, any mortgage insur- or an employer identification number (EIN). amounts received before the corpora-
ance premiums you paid, and if you purchased tion changed to cooperative owner-
a principal residence during the year, it will also If you can take a deduction for points that ship.
show the points paid during the year, including weren’t reported to you on Form 1098, deduct
those points on Schedule A (Form 1040), b. At all times during the year, at least
seller-paid points, that are deductible as interest 80% of the total square footage of the
to the extent you do not exceed the home ac- line 8c.
corporation's property is used or avail-
quisition debt limit. See Part II. Limits on Home able for use by the tenant-stockhold-
Mortgage Interest Deduction, later. However, More than one borrower. If you and at least
one other person (other than your spouse if you ers for residential or residential-rela-
the statement shouldn't show any interest that ted use.
was paid for you by a government agency. file a joint return) were liable for and paid inter-
est on a mortgage that was for your home, and c. At least 90% of the corporation's ex-
As a general rule, Form 1098 will include the other person received a Form 1098 showing penditures paid or incurred during the
only points that you can fully deduct in the year the interest that was paid during the year, attach year are for the acquisition, construc-
paid. However, it may report points that you a statement to your paper return explaining this. tion, management, maintenance, or
can't deduct, particularly if you are filing married Show how much of the interest each of you care of corporate property for the ben-
filing separately or have mortgages for multiple paid, and give the name and address of the per- efit of the tenant-stockholders.
properties. You must take care to deduct only son who received the form. Deduct your share
those points legally allowable. Additionally, of the interest on Schedule A (Form 1040),
certain points not included on Form 1098 may line 8b, and print “See attached” next to the line.

8 Publication 936 (2023)

Stock used to secure debt. In some cases, Your home mortgage interest deduction is Mortgage treated as used to buy, build, or
you can't use your cooperative housing stock to limited to the interest on the part of your home substantially improve home. A mortgage se-
secure a debt because of either: mortgage debt that isn't more than your quali- cured by a qualified home may be treated as
• Restrictions under local or state law, or fied loan limit. This is the part of your home home acquisition debt, even if you don't actually
• Restrictions in the cooperative agreement mortgage debt that is grandfathered debt or that use the proceeds to buy, build, or substantially
(other than restrictions in which the main isn't more than the limits for home acquisition improve the home. This applies in the following
purpose is to permit the tenant- debt. Table 1 can help you figure your qualified situations.
stockholder to treat unsecured debt as se- loan limit and your deductible home mortgage
1. You buy your home within 90 days before
cured debt). interest.
or after the date you take out the mort-
However, you can treat a debt as secured by gage. The home acquisition debt is limited
the stock to the extent that the proceeds are Home Acquisition Debt to the home's cost, plus the cost of any
used to buy the stock under the allocation of in- substantial improvements within the limit
terest rules. Home acquisition debt is a mortgage you took described below in (2) or (3). (See Exam-
out after October 13, 1987, to buy, build, or sub- ple 1, later.)
Figuring deductible home mortgage inter- stantially improve a qualified home (your main 2. You build or substantially improve your
est. Generally, if you're a tenant-stockholder, or second home). It must also be secured by home and take out the mortgage before
you can deduct payments you make for your that home. the work is completed. The home acquisi-
share of the interest paid or incurred by the co-
operative. The interest must be on a debt to tion debt is limited to the amount of the ex-
If the amount of your mortgage is more than penses incurred within 24 months before
buy, build, change, improve, or maintain the co- the cost of the home plus the cost of any sub-
operative's housing, or on a debt to buy the the date of the mortgage.
stantial improvements, only the debt that isn't
land. more than the cost of the home plus substantial 3. You build or substantially improve your
Figure your share of this interest by multiply- improvements qualifies as home acquisition home and take out the mortgage within 90
ing the total by the following fraction. debt. days after the work is completed. The
home acquisition debt is limited to the
Your shares of stock in the
Home acquisition debt limit. The total amount of the expenses incurred within
cooperative
amount you (or your spouse if married filing a the period beginning 24 months before the
The total shares of stock joint return) can treat as home acquisition debt work is completed and ending on the date
in the cooperative on your main home and second home is limited of the mortgage. (See Example 2, later.)
based on when the debt is secured.
Cooperative apartment owner. If you own • For debt secured after October 13, 1987, Example 1. You bought your main home on
a cooperative apartment, you must reduce your and prior to December 16, 2017, the limit is June 3 for $175,000. You paid for the home with
home mortgage interest deduction by your $1 million ($500,000 if married filing sepa- cash you got from the sale of your old home. On
share of any cash portion of a patronage divi- rately). July 15, you took out a mortgage of $150,000
dend that the cooperative receives. The patron- • For debt secured after December 15, secured by your main home. You used the
age dividend is a partial refund to the coopera- 2017, the limit is $750,000 ($375,000 if $150,000 to invest in stocks. You can treat the
tive housing corporation of mortgage interest if married filing separately). However, a tax- mortgage as taken out to buy your home be-
paid in a prior year. payer who enters into a written binding cause you bought the home within 90 days be-
If you receive a Form 1098 from the cooper- contract before December 15, 2017, to fore you took out the mortgage. The entire mort-
ative housing corporation, the form should show close on the purchase of a principal resi- gage qualifies as home acquisition debt
only the amount you can deduct. dence before January 1, 2018, and who because it wasn't more than the home's cost.
Limits on deduction. To figure how the purchases such residence before April 1,
2018, is considered to have incurred the Example 2. On January 31, Logan began
limits discussed in Part II apply to you, treat your building a home on the lot that Logan owned.
share of the cooperative's debt as debt incurred home acquisition debt prior to December
16, 2017. Logan used $45,000 of personal funds to build
by you. The cooperative should determine your the home. The home was completed on Octo-
share of its grandfathered debt, and its home The limits above are reduced (but not below ber 31. On November 21, Logan took out a
acquisition debt. (Your share of each of these zero) by the amount of your grandfathered debt $36,000 mortgage that was secured by the
types of debt is equal to the average balance of (discussed later). home. The mortgage can be treated as used to
each debt multiplied by the fraction just given.) build the home because it was taken out within
After your share of the average balance of each Refinanced home acquisition debt. Any se- 90 days after the home was completed. The en-
type of debt is determined, you include it with cured debt you use to refinance home acquisi- tire mortgage qualifies as home acquisition debt
the average balance of that type of debt se- tion debt is treated as home acquisition debt. because it wasn't more than the expenses in-
cured by your stock. However, the new debt will qualify as home ac- curred within the period beginning 24 months
quisition debt only up to the amount of the bal- before the home was completed. This is illustra-
Form 1098. The cooperative should give ance of the old mortgage principal just before ted by Figure C.
you a Form 1098 showing your share of the in- the refinancing. Any additional debt not used to
terest. Use the rules in this publication to deter- buy, build, or substantially improve a qualified
mine your deductible mortgage interest. home isn't home acquisition debt. Figure C.
Home
Mortgage that qualifies later. A mortgage
Part II. Limits on Home that doesn't qualify as home acquisition debt
Logan
Starts
Completed
($45,000 in
Mortgage Interest
$36,000
because it doesn't meet all the requirements Building Personal Mortgage
may qualify at a later time. For example, a debt
Deduction
Home Funds Used) Taken Out
that you use to buy your home may not qualify
as home acquisition debt because it isn't se-
This part of the publication discusses the limits cured by the home. However, if the debt is later Jan. 31 Oct. 31 Nov. 21
on deductible home mortgage interest. These secured by the home, it may qualify as home
limits apply to your home mortgage interest ex- acquisition debt after that time. Similarly, a debt
pense if you have a home mortgage that doesn't that you use to buy property may not qualify be-
fit into any of the three categories listed at the cause the property isn't a qualified home. How- 9 Months 22 Days
beginning of Part I under Fully deductible inter- ever, if the property later becomes a qualified (Within 24 Months) (Within 90 Days)
est, earlier. home, the debt may qualify after that time.

Publication 936 (2023) 9

 Date of the mortgage. The date you take Part of home not a qualified home. To was refinanced. After that, you treat it as home
out your mortgage is the day the loan proceeds figure your home acquisition debt, you must di- acquisition debt to the extent that it was used to
are disbursed. This is generally the closing vide the cost of your home and improvements buy, build, or substantially improve the home.
date. You can treat the day you apply in writing between the part of your home that is a qualified
for your mortgage as the date you take it out. home and any part that isn't a qualified home. Exception. If the debt before refinancing
However, this applies only if you receive the See Divided use of your home under Qualified was like a balloon note (the principal on the
loan proceeds within a reasonable time (such Home in Part I, earlier. debt wasn't amortized over the term of the
as within 30 days) after your application is ap- debt), then you treat the refinanced debt as
proved. If a timely application you make is rejec- grandfathered debt for the term of the first refi-
ted, a reasonable additional time will be allowed
Grandfathered Debt nancing. This term can't be more than 30 years.
to make a new application.
If you took out a mortgage on your home before Example. You took out a $200,000 first
October 14, 1987, or you refinanced such a mortgage on your home in 1986. The mortgage
Cost of home or improvements. To deter-
mortgage, it may qualify as grandfathered debt. was a 7-year balloon note and the entire bal-
mine your cost, include amounts paid to acquire
To qualify, it must have been secured by your ance on the note was due in 1993. You refi-
any interest in a qualified home or to substan-
qualified home on October 13, 1987, and at all nanced the debt in 1993 with a new 30-year
tially improve the home.
times after that date. How you used the pro- mortgage. The refinanced debt is treated as
The cost of building or substantially improv-
ceeds doesn't matter. grandfathered debt for its entire term (30 years).
ing a qualified home includes the costs to ac-
quire real property and building materials, fees Grandfathered debt isn't limited. All of the in-
for architects and design plans, and required terest you paid on grandfathered debt is fully Table 1 Instructions
building permits. deductible home mortgage interest. However,
the amount of your grandfathered debt reduces You can deduct all of the interest you paid dur-
Substantial improvement. An improve- the limit for home acquisition debt. ing the year on mortgages secured by your
ment is substantial if it: main home or second home in either of the fol-
• Adds to the value of your home, Refinanced grandfathered debt. If you refi- lowing two situations.
• Prolongs your home's useful life, or nanced grandfathered debt after October 13, • All the mortgages are grandfathered debt.
• Adapts your home to new uses. 1987, for an amount that wasn't more than the • The total of the mortgage balances for the
Repairs that maintain your home in good mortgage principal left on the debt, then you still entire year is within the limits discussed
condition, such as repainting your home, aren't treat it as grandfathered debt. To the extent the earlier under Home Acquisition Debt.
substantial improvements. However, if you paint new debt is more than that mortgage principal,
it is treated as home acquisition debt (so long In either of those cases, you don't need Table 1.
your home as part of a renovation that substan- Otherwise, you can use Table 1 to determine
tially improves your qualified home, you can in- as the proceeds were used to buy, build, or sub-
stantially improve the home), and the mortgage your qualified loan limit and deductible home
clude the painting costs in the cost of the im- mortgage interest.
provements. is a mixed-use mortgage (discussed later under
Average Mortgage Balance in the Table 1 In- Fill out only one Table 1 for both your
Acquiring an interest in a home because structions). The debt must be secured by the TIP main and second home regardless of
of a divorce. If you incur debt to acquire the in- qualified home. how many mortgages you have.
terest of a spouse or former spouse in a home You treat grandfathered debt that was refi-
because of a divorce or legal separation, you nanced after October 13, 1987, as grandfath-
can treat that debt as home acquisition debt. ered debt only for the term left on the debt that

10 Publication 936 (2023)

Table 1. Worksheet To Figure Your Qualified Loan Limit and Deductible Home
Mortgage Interest for the Current Year

See the Table 1 Instructions. Keep for Your Records

Part I Qualified Loan Limit

1. Enter the average balance of all your grandfathered debt. See the line 1
instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. Enter the average balance of all your home acquisition debt incurred after October
12, 1987, and prior to December 16, 2017. See the line 2 instructions . . . . . . . . . . . . . . 2.

3. Enter $1,000,000 ($500,000 if married filing separately) . . . . . . . . . . . . . . . . . . . . . . . . . . 3.

4. Enter the larger of the amount on line 1 or the amount on line 3 . . . . . . . . . . . . . . . . . . . . 4.

5. Add the amounts on lines 1 and 2. Enter the total here . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.

6. Enter the smaller of the amount on line 4 or the amount on line 5 . . . . . . . . . . . . . . . . . . 6.

• If you have no home acquisition debt incurred after December 15, 2017, or the
amount on line 6 is $750,000 ($375,000 if married filing separately) or more,
line 6 is your qualified loan limit. Enter this amount on line 11 and go to Part II,
line 12.
• If you have home acquisition debt incurred after December 15, 2017, go to line 7.
7. Enter the average balance of all your home acquisition debt incurred after December
15, 2017. See the line 7 instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.

8. Enter $750,000 ($375,000 if married filing separately) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.

9. Enter the larger of the amount on line 6 or the amount on line 8 . . . . . . . . . . . . . . . . . . . . 9.

10. Add the amounts on lines 6 and 7. Enter the total here . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.

11. Enter the smaller of line 9 or line 10. This is your qualified loan limit . . . . . . . . . . . . . 11.

Part II Deductible Home Mortgage Interest

12. Enter the total of the average balances of all mortgages from lines 1, 2, and 7 on all
qualified homes.
See the line 12 instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.

• If line 11 is less than line 12, go on to line 13.

• If line 11 is equal to or more than line 12, stop here. All of your interest on all the
mortgages included on line 12 is deductible as home mortgage interest on
Schedule A (Form 1040).
13. Enter the total amount of interest that you paid on the loans from line 12. See the
line 13 instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.

14. Divide the amount on line 11 by the amount on line 12. Enter the result as a decimal
amount (rounded to three places) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14. ×.

15. Multiply the amount on line 13 by the decimal amount on line 14. Enter the result.
This is your deductible home mortgage interest. Enter this amount on
Schedule A (Form 1040) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.

16. Subtract the amount on line 15 from the amount on line 13. Enter the result. This
isn't home mortgage interest. See the line 16 instructions . . . . . . . . . . . . . . . . . . . . . . 16.

Publication 936 (2023) 11

 your home (home acquisition debt) and partly to
1. Enter the interest paid in 2023.
Average Mortgage Balance buy a car (home equity debt).
Don't include points, or any
Complete lines 1, 2, and 7 of Table 1 by in-
interest paid in 2023 that is for a
You have to figure the average balance of each cluding the separate average balances of any
year after 2023. However, do
mortgage to determine your qualified loan limit. grandfathered debt and home acquisition debt
include interest that is for 2023
You need these amounts to complete lines 1, 2, (determined by the date the debt was acquired)
but was paid in an earlier in your mixed-use mortgage. Don’t use the
7, and 12 of Table 1. You can use the highest
year . . . . . . . . . . . . . . . . . . . . . . . . methods described earlier in this section to fig-
mortgage balances during the year, but you
may benefit most by using the average balan- 2. Enter the annual interest rate on ure the average balance of either category. In-
ces. The following are methods you can use to the mortgage. If the interest rate stead, for each category, use the following
figure your average mortgage balances. How- varied in 2023, use the lowest method.
ever, if a mortgage has more than one category rate for the year . . . . . . . . . . . . . . 1. Figure the balance of that category of debt
of debt, see Mixed-use mortgages, later, in this for each month. This is the amount of the
section. 3. Divide the amount on line 1 by
the amount on line 2. Enter the loan proceeds allocated to that category,
reduced by your principal payments on the
Average of first and last balance method. result . . . . . . . . . . . . . . . . . . . . . . .
mortgage previously applied to that cate-
You can use this method if all the following ap- gory. Principal payments on a mixed-use
ply. Example. You had a mortgage secured by mortgage are applied in full to each cate-
• You didn't borrow any new amounts on the your main home all year. You paid interest of gory of debt, until its balance is zero, in the
mortgage during the year. (This doesn't in- $2,500 on this loan. The interest rate on the following order.
clude borrowing the original mortgage loan was 9% (0.09) all year. Your average bal-
amount.) ance using this method is $27,778, figured as a. First, any home equity debt not used
• You didn't prepay more than 1 month's follows. to buy, build, or substantially improve
principal during the year. (This includes the home.
prepayment by refinancing your home or b. Next, any grandfathered debt.
by applying proceeds from its sale.) 1. Enter the interest paid in 2023.
• You had to make level payments at fixed Don’t include points, mortgage c. Finally, any home acquisition debt.
equal intervals on at least a semi-annual insurance premiums, or any
2. Add together the monthly balances figured
basis. You treat your payments as level interest paid in 2023 that is for
for b and c in (1).
even if they were adjusted from time to a year after 2023. However, do
time because of changes in the interest include interest that is for 2023 Complete line 12 of Table 1 using the figure
rate. but was paid in an earlier from line 2 above.
To figure your average balance, com- year . . . . . . . . . . . . . . . . . . . . . . . $2,500
Example 1. In 1986, you took out a first
plete the following worksheet. 2. Enter the annual interest rate mortgage of $1,400,000. The mortgage was a
on the mortgage. If the interest 7-year balloon note and the entire balance on
rate varied in 2023, use the the note was due in 1993. You refinanced the
lowest rate for the year . . . . . . . 0.09 debt in 1993 with a new 30-year mortgage
1. Enter the balance as of the first
day of the year that the 3. Divide the amount on line 1 by (grandfathered debt). On March 2, 2023, when
mortgage was secured by your the amount on line 2. Enter the the home had a fair market value of $1,700,000
and you owed $500,000 on the mortgage, you
qualified home during the year result . . . . . . . . . . . . . . . . . . . . . . $27,778
(generally, January 1) . . . . . . . . took out a second mortgage for $200,000. You
used $180,000 of the proceeds to make sub-
2. Enter the balance as of the last Statements provided by your lender. If you stantial improvements to your home (home ac-
day of the year that the receive monthly statements showing the closing quisition debt) and the remaining $20,000 to
mortgage was secured by your balance or the average balance for the month, buy a car (home equity debt). Under the loan
qualified home during the year you can use either to figure your average bal- agreement, you must make principal payments
(generally, December 31) . . . . . ance for the year. You can treat the balance as of $1,000 at the end of each month. During
zero for any month the mortgage wasn't se- 2023, your principal payments on the second
3. Add amounts on lines 1 and cured by your qualified home. mortgage totaled $10,000.
2 .......................... For each mortgage, figure your average bal- To complete Table 1, line 7, you must figure
4. Divide the amount on line 3 by ance by adding your monthly closing or average a separate average balance for the part of your
2.0. Enter the result . . . . . . . . . . balances and dividing that total by the number second mortgage that is home acquisition debt.
of months the home secured by that mortgage The January and February balances were zero.
was a qualified home during the year. The March through December balances were
Interest paid divided by interest rate all $180,000 because none of your principal
If your lender can give you your average bal-
method. You can use this method if at all times payments are applied to the home acquisition
ance for the year, you can use that amount.
in 2023 the mortgage was secured by your debt. (They are all applied to the home equity
qualified home and the interest was paid at Example. You had a home loan secured by debt, reducing it to $10,000 [$20,000 −
least monthly. your main home all year. You received monthly $10,000].) The monthly balances of the home
Complete the following worksheet to statements showing your average balance for acquisition debt total $1,800,000 ($180,000 ×
figure your average balance. each month. You can figure your average bal- 10). Therefore, the average balance of the
ance for the year by adding your monthly aver- home acquisition debt for 2023 was $150,000
age balances and dividing the total by 12. ($1,800,000 ÷ 12).

Mixed-use mortgages. A mixed-use mort- Example 2. The facts are the same as in
gage is a loan that consists of more than one of Example 1. In 2024, your January through Octo-
the three categories of debt (grandfathered ber principal payments on your second mort-
debt, home acquisition debt, and home equity gage are applied to the home equity debt, re-
debt). For example, a mortgage you took out ducing it to zero. The balance of the home
during the year is a mixed-use mortgage if you acquisition debt remains $180,000 for each of
used its proceeds partly to refinance a mort- those months. Because your November and
gage that you took out in an earlier year to buy December principal payments are applied to the
home acquisition debt, the November balance

12 Publication 936 (2023)

is $179,000 ($180,000 − $1,000) and the De- homes after December 15, 2017, to buy, build, 1. Figure your deductible points for the cur-
cember balance is $178,000 ($180,000 − or substantially improve the home (home ac- rent year using the rules explained under
$2,000). The monthly balances total $2,157,000 quisition debt). Add the results together and en- Points in Part I, earlier.
[($180,000 × 10) + $179,000 + $178,000]. ter the total on line 7.
2. Multiply the amount in item 1 by the deci-
Therefore, the average balance of the home ac-
mal amount on line 14. Enter the result on
quisition debt for 2024 is $179,750 ($2,157,000 Line 12 Schedule A (Form 1040), line 8a or 8c,
÷ 12).
whichever applies. This amount is fully de-
Figure the average balance for the current year ductible.
Line 1 of each outstanding home mortgage. Add the
average balances together and enter the total 3. Subtract the result in item 2 from the
Figure the average balance for the current year on line 12. See Average Mortgage Balance, amount in item 1. This amount isn't deduc-
of each mortgage you had on all qualified earlier. tible as home mortgage interest. However,
homes on October 13, 1987 (grandfathered if you used any of the loan proceeds for
debt). Add the results together and enter the to- business or investment activities, see the
Note. If the average balance consists of
tal on line 1. Include the average balance for the instructions for line 16 next.
more than one category of debt (grandfathered
current year for any grandfathered debt part of a debt, home acquisition debt, and home equity
mixed-use mortgage. debt), see Mixed-use mortgages, earlier, to fig- Line 16
ure the average mortgage balance.
Line 2 You can't deduct the amount of interest on
line 16 as home mortgage interest. If you didn't
Line 13 use any of the proceeds of any mortgage inclu-
Figure the average balance for the current year
of each mortgage you took out on all qualified ded on line 12 of the worksheet for business, in-
If you make payments to a financial institution,
homes after October 13, 1987, and prior to De- vestment, or other deductible activities, then all
or to a person whose business is making loans,
cember 16, 2017, to buy, build, or substantially the interest on line 16 is personal interest. Per-
you should get Form 1098 or a similar state-
improve the home (home acquisition debt). Add sonal interest isn't deductible.
ment from the lender. This form will show the
the results together and enter the total on line 2. amount of interest to enter on line 13. Also, in-
Include the average balance for the current year clude on this line any other interest payments
for any home acquisition debt part of a made on debts secured by a qualified home for
mixed-use mortgage. which you didn't receive a Form 1098. Don't in-
clude points or mortgage insurance premiums
Line 7 on this line.

Figure the average balance for the current year Claiming your deductible points. Figure
of each mortgage you took out on all qualified your deductible points as follows.

Publication 936 (2023) 13

Table 2. Where To Deduct Your Interest Expense

IF you have ... THEN deduct it on ... AND for more information, go to ...
deductible student loan interest Schedule 1 (Form 1040), line 21 Pub. 970, Tax Benefits for Education.
deductible home mortgage interest Schedule A (Form 1040), line 8a this publication (936).
and points reported on Form 1098
deductible home mortgage interest Schedule A (Form 1040), line 8b this publication (936).
not reported on Form 1098
deductible points not reported on Schedule A (Form 1040), line 8c this publication (936).
Form 1098
deductible investment interest (other Schedule A (Form 1040), line 9 Pub. 550, Investment Income and
than incurred to produce rents or Expenses.
royalties)
deductible business interest Schedule C (Form 1040)
(non-farm)
deductible farm business interest Schedule F (Form 1040) Pub. 225, Farmer's Tax Guide.
deductible interest incurred to Schedule E (Form 1040) Pub. 527, Residential Rental Property.
produce rents or royalties
personal interest not deductible.

allocable to your business for the entire year. 1099-G); and interest, dividend, and retirement
If you did use all or part of any mortgage You paid $14,000 of interest on mortgage A and statements from banks and investment firms
proceeds for business, investment, or other de- $16,000 of interest on mortgage B. You figure (Forms 1099), you have several options to
ductible activities, the part of the interest on the amount of home mortgage interest you can choose from to prepare and file your tax return.
line 16 that is allocable to those activities can deduct by using Table 1. You determine that You can prepare the tax return yourself, see if
be deducted as business, investment, or other $15,000 of the interest can be deducted as you qualify for free tax preparation, or hire a tax
deductible expense, subject to any limits that home mortgage interest. professional to prepare your return.
apply. Table 2 shows where to deduct that inter- The interest you can allocate to your busi-
est. See Allocation of Interest in Temporary ness is the smaller of: Free options for tax preparation. Your op-
Regulations section 1.163-8T. tions for preparing and filing your return online
1. The amount on Table 1, line 16, of the
or in your local community, if you qualify, include
worksheet ($15,000); or
the following.
The following two rules describe how to allo-
cate the interest on line 16 to a business or in- 2. The total amount of interest allocable to • Free File. This program lets you prepare
vestment activity. the business ($16,500), figured by multi- and file your federal individual income tax
• If you used all of the proceeds of the mort- plying the amount on line 13 (the $30,000 return for free using software or Free File
gages on line 12 for one activity, then all total interest paid) by the following fraction. Fillable Forms. However, state tax prepara-
the interest on line 16 is allocated to that tion may not be available through Free File.
activity. In this case, deduct the interest on $110,000 (the average balance Go to IRS.gov/FreeFile to see if you qualify
the form or schedule to which it applies. of the mortgage allocated for free online federal tax preparation, e-fil-
• If you used the proceeds of the mortgages to the business) ing, and direct deposit or payment options.
on line 12 for more than one activity, then $200,000 (the total average • VITA. The Volunteer Income Tax Assis-
you can allocate the interest on line 16 balance of all mortgages) tance (VITA) program offers free tax help to
among the activities in any manner you se- people with low-to-moderate incomes, per-
lect (up to the total amount of interest oth- Because $15,000 is the smaller of items 1 sons with disabilities, and limited-Eng-
erwise allocable to each activity, explained and 2, that is the amount of interest you can al- lish-speaking taxpayers who need help
next). locate to your business. You deduct this amount preparing their own tax returns. Go to
on your Schedule C (Form 1040). IRS.gov/VITA, download the free IRS2Go
app, or call 800-906-9887 for information
You figure the total amount of interest other-
on free tax return preparation.
wise allocable to each activity by multiplying the
amount on line 13 by the following fraction. How To Get Tax Help • TCE. The Tax Counseling for the Elderly
(TCE) program offers free tax help for all
Amount on line 12 taxpayers, particularly those who are 60
allocated to that activity If you have questions about a tax issue; need
years of age and older. TCE volunteers
help preparing your tax return; or want to down-
Total amount on line 12 specialize in answering questions about
load free publications, forms, or instructions, go
pensions and retirement-related issues
to IRS.gov to find resources that can help you
unique to seniors. Go to IRS.gov/TCE or
Example. You had two mortgages (A and right away.
download the free IRS2Go app for informa-
B) on your main home during the entire year. tion on free tax return preparation.
Mortgage A had an average balance of Preparing and filing your tax return. After
receiving all your wage and earnings state- • MilTax. Members of the U.S. Armed
$90,000, and mortgage B had an average bal- Forces and qualified veterans may use Mil-
ance of $110,000. ments (Forms W-2, W-2G, 1099-R, 1099-MISC,
Tax, a free tax service offered by the De-
You determine that the proceeds of mort- 1099-NEC, etc.); unemployment compensation
partment of Defense through Military One-
gage A are allocable to personal expenses for statements (by mail or in a digital format) or
Source. For more information, go to
the entire year. The proceeds of mortgage B are other government payment statements (Form

14 Publication 936 (2023)

 MilitaryOneSource (MilitaryOneSource.mil/ understanding of tax matters. For more informa- receive certain types of written correspondence
MilTax). tion on how to choose a tax preparer, go to Tips in the following formats.
Also, the IRS offers Free Fillable Forms, for Choosing a Tax Preparer on IRS.gov. • Standard Print.
which can be completed online and then
• Large Print.
e-filed regardless of income.
Employers can register to use Business • Braille.
Using online tools to help prepare your re- Services Online. The Social Security Adminis- • Audio (MP3).
turn. Go to IRS.gov/Tools for the following. tration (SSA) offers online service at SSA.gov/
• The Earned Income Tax Credit Assistant employer for fast, free, and secure W-2 filing op- • Plain Text File (TXT).
(IRS.gov/EITCAssistant) determines if tions to CPAs, accountants, enrolled agents, • Braille Ready File (BRF).
you’re eligible for the earned income credit and individuals who process Form W-2, Wage
(EIC). and Tax Statement, and Form W-2c, Corrected Disasters. Go to IRS.gov/DisasterRelief to re-
• The Online EIN Application (IRS.gov/EIN) Wage and Tax Statement. view the available disaster tax relief.
helps you get an employer identification
number (EIN) at no cost. IRS social media. Go to IRS.gov/SocialMedia Getting tax forms and publications. Go to
• The Tax Withholding Estimator (IRS.gov/ to see the various social media tools the IRS IRS.gov/Forms to view, download, or print all
W4App) makes it easier for you to estimate uses to share the latest information on tax the forms, instructions, and publications you
the federal income tax you want your em- changes, scam alerts, initiatives, products, and may need. Or, you can go to IRS.gov/
ployer to withhold from your paycheck. services. At the IRS, privacy and security are OrderForms to place an order.
This is tax withholding. See how your with- our highest priority. We use these tools to share
holding affects your refund, take-home pay, public information with you. Don’t post your so- Getting tax publications and instructions in
or tax due. cial security number (SSN) or other confidential eBook format. Download and view most tax
information on social media sites. Always pro- publications and instructions (including the In-
• The First-Time Homebuyer Credit Account
tect your identity when using any social net- structions for Form 1040) on mobile devices as
Look-up (IRS.gov/HomeBuyer) tool pro-
working site. eBooks at IRS.gov/eBooks.
vides information on your repayments and
account balance. The following IRS YouTube channels provide IRS eBooks have been tested using Apple's
• The Sales Tax Deduction Calculator short, informative videos on various tax-related iBooks for iPad. Our eBooks haven’t been tes-
(IRS.gov/SalesTax) figures the amount you topics in English, Spanish, and ASL. ted on other dedicated eBook readers, and
can claim if you itemize deductions on • Youtube.com/irsvideos. eBook functionality may not operate as inten-
Schedule A (Form 1040). • Youtube.com/irsvideosmultilingua. ded.
• Youtube.com/irsvideosASL.
Getting answers to your tax ques- Access your online account (individual tax-
tions. On IRS.gov, you can get Watching IRS videos. The IRS Video portal payers only). Go to IRS.gov/Account to se-
up-to-date information on current (IRSVideos.gov) contains video and audio pre- curely access information about your federal tax
events and changes in tax law. sentations for individuals, small businesses, account.
• IRS.gov/Help: A variety of tools to help you and tax professionals. • View the amount you owe and a break-
down by tax year.
get answers to some of the most common
tax questions.
Online tax information in other languages. • See payment plan details or apply for a
You can find information on IRS.gov/ new payment plan.
• IRS.gov/ITA: The Interactive Tax Assistant,
a tool that will ask you questions and,
MyLanguage if English isn’t your native lan- • Make a payment or view 5 years of pay-
guage. ment history and any pending or sched-
based on your input, provide answers on a
uled payments.
number of tax topics.
• IRS.gov/Forms: Find forms, instructions,
Free Over-the-Phone Interpreter (OPI) Serv- • Access your tax records, including key
ice. The IRS is committed to serving taxpayers data from your most recent tax return, and
and publications. You will find details on
with limited-English proficiency (LEP) by offer- transcripts.
the most recent tax changes and interac-
tive links to help you find answers to your
ing OPI services. The OPI Service is a federally • View digital copies of select notices from
funded program and is available at Taxpayer the IRS.
questions.
• You may also be able to access tax infor-
Assistance Centers (TACs), most IRS offices, • Approve or reject authorization requests
and every VITA/TCE tax return site. The OPI from tax professionals.
mation in your e-filing software.
Service is accessible in more than 350 lan- • View your address on file or manage your
guages. communication preferences.
Need someone to prepare your tax return?
There are various types of tax return preparers, Accessibility Helpline available for taxpay- Get a transcript of your return. With an on-
including enrolled agents, certified public ac- ers with disabilities. Taxpayers who need in- line account, you can access a variety of infor-
countants (CPAs), accountants, and many oth- formation about accessibility services can call mation to help you during the filing season. You
ers who don’t have professional credentials. If 833-690-0598. The Accessibility Helpline can can get a transcript, review your most recently
you choose to have someone prepare your tax answer questions related to current and future filed tax return, and get your adjusted gross in-
return, choose that preparer wisely. A paid tax accessibility products and services available in come. Create or access your online account at
preparer is: alternative media formats (for example, braille, IRS.gov/Account.
• Primarily responsible for the overall sub- large print, audio, etc.). The Accessibility Help-
stantive accuracy of your return, line does not have access to your IRS account. Tax Pro Account. This tool lets your tax pro-
• Required to sign the return, and For help with tax law, refunds, or account-rela- fessional submit an authorization request to ac-
• Required to include their preparer tax iden- ted issues, go to IRS.gov/LetUsHelp. cess your individual taxpayer IRS online ac-
tification number (PTIN). count. For more information, go to IRS.gov/
Note. Form 9000, Alternative Media Prefer- TaxProAccount.
Although the tax preparer always signs ence, or Form 9000(SP) allows you to elect to
! the return, you're ultimately responsible Using direct deposit. The safest and easiest
CAUTION for providing all the information re- way to receive a tax refund is to e-file and
quired for the preparer to accurately prepare choose direct deposit, which securely and elec-
your return and for the accuracy of every item tronically transfers your refund directly into your
reported on the return. Anyone paid to prepare financial account. Direct deposit also avoids the
tax returns for others should have a thorough possibility that your check could be lost, stolen,
destroyed, or returned undeliverable to the IRS.

Publication 936 (2023) 15

Eight in 10 taxpayers use direct deposit to re- • Cash: You may be able to pay your taxes sue can’t be handled online or by phone. All
ceive their refunds. If you don’t have a bank ac- with cash at a participating retail store. TACs now provide service by appointment, so
count, go to IRS.gov/DirectDeposit for more in- • Same-Day Wire: You may be able to do you’ll know in advance that you can get the
formation on where to find a bank or credit same-day wire from your financial institu- service you need without long wait times. Be-
union that can open an account online. tion. Contact your financial institution for fore you visit, go to IRS.gov/TACLocator to find
availability, cost, and time frames. the nearest TAC and to check hours, available
Reporting and resolving your tax-related services, and appointment options. Or, on the
identity theft issues. Note. The IRS uses the latest encryption IRS2Go app, under the Stay Connected tab,
• Tax-related identity theft happens when technology to ensure that the electronic pay- choose the Contact Us option and click on “Lo-
someone steals your personal information ments you make online, by phone, or from a cal Offices.”
to commit tax fraud. Your taxes can be af- mobile device using the IRS2Go app are safe
fected if your SSN is used to file a fraudu- and secure. Paying electronically is quick, easy,
lent return or to claim a refund or credit. and faster than mailing in a check or money or-
The Taxpayer Advocate
der. Service (TAS) Is Here To
• The IRS doesn’t initiate contact with tax-
payers by email, text messages (including Help You
What if I can’t pay now? Go to IRS.gov/
shortened links), telephone calls, or social
Payments for more information about your op- What Is TAS?
media channels to request or verify per-
tions.
sonal or financial information. This includes TAS is an independent organization within the
requests for personal identification num-
• Apply for an online payment agreement
(IRS.gov/OPA) to meet your tax obligation IRS that helps taxpayers and protects taxpayer
bers (PINs), passwords, or similar informa- rights. TAS strives to ensure that every taxpayer
in monthly installments if you can’t pay
tion for credit cards, banks, or other finan- is treated fairly and that you know and under-
your taxes in full today. Once you complete
cial accounts. stand your rights under the Taxpayer Bill of
the online process, you will receive imme-
• Go to IRS.gov/IdentityTheft, the IRS Iden- diate notification of whether your agree- Rights.
tity Theft Central webpage, for information
ment has been approved.
on identity theft and data security protec-
tion for taxpayers, tax professionals, and
• Use the Offer in Compromise Pre-Qualifier How Can You Learn About Your
businesses. If your SSN has been lost or
to see if you can settle your tax debt for Taxpayer Rights?
less than the full amount you owe. For
stolen or you suspect you’re a victim of
more information on the Offer in Compro- The Taxpayer Bill of Rights describes 10 basic
tax-related identity theft, you can learn
mise program, go to IRS.gov/OIC. rights that all taxpayers have when dealing with
what steps you should take.
• Get an Identity Protection PIN (IP PIN). IP the IRS. Go to TaxpayerAdvocate.IRS.gov to
Filing an amended return. Go to IRS.gov/ help you understand what these rights mean to
PINs are six-digit numbers assigned to tax-
Form1040X for information and updates. you and how they apply. These are your rights.
payers to help prevent the misuse of their
SSNs on fraudulent federal income tax re- Know them. Use them.
Checking the status of your amended re-
turns. When you have an IP PIN, it pre- turn. Go to IRS.gov/WMAR to track the status
vents someone else from filing a tax return of Form 1040-X amended returns. What Can TAS Do for You?
with your SSN. To learn more, go to
IRS.gov/IPPIN. It can take up to 3 weeks from the date TAS can help you resolve problems that you
! you filed your amended return for it to can’t resolve with the IRS. And their service is
Ways to check on the status of your refund. CAUTION show up in our system, and processing
free. If you qualify for their assistance, you will
• Go to IRS.gov/Refunds. it can take up to 16 weeks. be assigned to one advocate who will work with
• Download the official IRS2Go app to your you throughout the process and will do every-
mobile device to check your refund status. Understanding an IRS notice or letter thing possible to resolve your issue. TAS can
• Call the automated refund hotline at you’ve received. Go to IRS.gov/Notices to find help you if:
800-829-1954. additional information about responding to an • Your problem is causing financial difficulty
The IRS can’t issue refunds before IRS notice or letter. for you, your family, or your business;
mid-February for returns that claimed • You face (or your business is facing) an im-
!
CAUTION the EIC or the additional child tax credit Responding to an IRS notice or letter. You mediate threat of adverse action; or
(ACTC). This applies to the entire refund, not can now upload responses to all notices and • You’ve tried repeatedly to contact the IRS
just the portion associated with these credits. letters using the Document Upload Tool. For no- but no one has responded, or the IRS
tices that require additional action, taxpayers hasn’t responded by the date promised.
will be redirected appropriately on IRS.gov to
Making a tax payment. Payments of U.S. tax
must be remitted to the IRS in U.S. dollars.
take further action. To learn more about the tool, How Can You Reach TAS?
go to IRS.gov/Upload.
Digital assets are not accepted. Go to IRS.gov/
Payments for information on how to make a pay- TAS has offices in every state, the District of
Note. You can use Schedule LEP (Form Columbia, and Puerto Rico. To find your advo-
ment using any of the following options. 1040), Request for Change in Language Prefer-
• IRS Direct Pay: Pay your individual tax bill cate’s number:
ence, to state a preference to receive notices, • Go to TaxpayerAdvocate.IRS.gov/Contact-
or estimated tax payment directly from your letters, or other written communications from
checking or savings account at no cost to Us;
the IRS in an alternative language. You may not • Download Pub. 1546, The Taxpayer Advo-
you. immediately receive written communications in
• Debit Card, Credit Card, or Digital Wallet: cate Service Is Your Voice at the IRS, avail-
the requested language. The IRS’s commitment able at IRS.gov/pub/irs-pdf/p1546.pdf;
Choose an approved payment processor to LEP taxpayers is part of a multi-year timeline
to pay online or by phone. • Call the IRS toll free at 800-TAX-FORM
that began providing translations in 2023. You (800-829-3676) to order a copy of Pub.
• Electronic Funds Withdrawal: Schedule a will continue to receive communications, includ-
payment when filing your federal taxes us- 1546;
ing notices and letters, in English until they are • Check your local directory; or
ing tax return preparation software or translated to your preferred language.
through a tax professional. • Call TAS toll free at 877-777-4778.
• Electronic Federal Tax Payment System: Contacting your local TAC. Keep in mind,
Best option for businesses. Enrollment is many questions can be answered on IRS.gov How Else Does TAS Help
required. without visiting a TAC. Go to IRS.gov/LetUsHelp Taxpayers?
• Check or Money Order: Mail your payment for the topics people ask about most. If you still
to the address listed on the notice or in- need help, TACs provide tax help when a tax is- TAS works to resolve large-scale problems that
structions. affect many taxpayers. If you know of one of

16 Publication 936 (2023)

these broad issues, report it to TAS at IRS.gov/ below a certain level and who need to resolve LITC near you, go to the LITC page at
SAMS. Be sure to not include any personal tax- tax problems with the IRS. LITCs can represent TaxpayerAdvocate.IRS.gov/LITC or see IRS
payer information. taxpayers in audits, appeals, and tax collection Pub. 4134, Low Income Taxpayer Clinic List, at
disputes before the IRS and in court. In addi- IRS.gov/pub/irs-pdf/p4134.pdf.
tion, LITCs can provide information about tax-
Low Income Taxpayer Clinics payer rights and responsibilities in different lan-
(LITCs) guages for individuals who speak English as a
second language. Services are offered for free
LITCs are independent from the IRS and TAS. or a small fee. For more information or to find an
LITCs represent individuals whose income is

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Form 1098 8 Line 10 8

A Form 8396 5 Loans 8, 9 O
(See also Mortgages)
Acquisition debt 2, 9, 10 Home improvement, points 7 Office in home 4
Alimony 5 G
Qualified loan limit 11
Amortization: Grandfathered debt 2, 10 P
Points 5 Ground rents 5
M Penalties:
Appraisal fees 7
Main home 4 Mortgage prepayment 4
Armed forces: H Points 5-8
Housing allowance 5 Married taxpayers 4
Home 2 Military housing allowance 5 Claiming deductible 13
Assistance (See Tax help)
Acquisition debt 2, 9 Ministers' housing allowance 5 Exception to general rule 7
Average mortgage balance 12
Construction 4 Missing children, photographs Excess 7
Cost of 10 of 1 Funds provided less than 7
B Destroyed 4 General rule 5
Mixed-use mortgages 12
Borrowers: Divided use 4, 10 Mortgage interest 2 Home improvement loans 7
More than one 8 Grandfathered debt 2, 10 Cooperative housing 9 Seller paid 7
Seller-paid points, treatment by Improvement loan, points 7 Credit 5 Prepaid interest 5, 8
buyer 7 Main 4 Fully deductible interest 2 Prepayment penalties 4
Business: Office in 4 Home mortgage interest 2 Publications (See Tax help)
Average mortgage balance, total Qualified 4 How to report 8
amount of interest otherwise Renting out part of 4 Q
allowable to each activity 13 Late payment charges 4
Sale of 4 Limits on deduction 9
Mortgage proceeds used for 8 Qualified homes 4
Second 4 Ministers' and military housing Qualified loan limit:
Time-sharing arrangements 4 allowance 5
C Housing allowance: Prepaid interest 5, 8
Average mortgage balance 12
Worksheet to figure (Table 1) 11
Clergy: Ministers and military 5 Prepayment penalty 4
Ministers' and military housing Refunds 5, 8
allowance 5 R
I Sale of home 4
Cooperative housing 4, 8, 9 Special situations 4 Redeemable ground rents 5
Cost of home or Improvements:
Statement 8 Refinancing 7
improvements 10 Cost of 10
Where to deduct 14 Grandfathered debt 10
Credits 5 Home acquisition debt 9
Worksheet to figure (Table 1) 11 Home acquisition debt 9
Points 7
Mortgage Interest Statement 8 Refunds 5, 8
D Substantial 10
Mortgages: Rent:
Interest 2
Date of mortgage 10 (See also Mortgage interest) Assistance payments (under sec. Nonredeemable ground rents 5
Debt 235 of National Housing Redeemable ground rents 5
Interest rate method 12 Act) 5
Choice to treat as not secured by Refunded 5, 8 Rental payments 5
home 4 Average balance 12 Renting of home:
Where to deduct 14 Date of 10
Grandfathered 2, 10 Investments: Part of 4
Home acquisition 2, 9 Ending early 8 Time-sharing arrangements 4
Average mortgage balance and Late qualifying 9
Not secured by home 3 total amount of interest Repairs 10
Secured 3 allowable 13 Mixed-use 12 Reverse Mortgages 5
Deductions 2 Mortgage proceeds used for 5, Preparation costs for note or
8 deed of trust 7
Home office 4 S
Proceeds invested in tax-exempt
Points 5, 13 securities 5 Sale of home 4
Deed preparation costs 7 J Proceeds used for business 8 Second home 4, 7
Divorced taxpayers 5, 10 Joint returns 4 Proceeds used for investment 8 Secured debt 3
Qualified loan limit 11, 12 Seller-paid points 7
F L Refinanced 7, 9, 10 Separate returns 4
Fees: Lender mortgage statements 12 Reverse 5 Separated taxpayers 5
Appraisal 7 Limits: Statements provided by Share of Interest 9
Notaries 7 lender 12 Spouses 4
Cooperative housing, mortgage
Points (See Points) interest deduction 9 To buy, build, or improve 9 Statements provided by
Figures (See Tables and figures) Deductibility of points 8 Wraparound 3 lender 12
Form 1040, Schedule A 8, 14 Home acquisition debt 9 Stock:
Form 1040, Schedule C or Home mortgage interest N Cooperative housing 9
C-EZ 14 deduction 9 Nonredeemable ground rents 5
Form 1040, Schedule E 14 Qualified loan limit 11, 12 Notary fees 7
Form 1040, Schedule F 14

Publication 936 (2023) 17

 How to figure (Table 1) 11 Tax-exempt securities:
T Mortgage to buy, build, or Mortgage proceeds invested W
improve home (Figure C) 9 in 5
Tables and figures: Points (Figure B) 5 Time-sharing arrangements 4 Worksheets:
Deductible home mortgage Qualified loan limit worksheet Deductible home mortgage
interest: (Table 1) 11 interest 11
Fully deductible, Tax credits 5 Qualified loan limit 11
determination of (Figure Wraparound mortgages 3
A) 2 Tax help 14

18 Publication 936 (2023)