Home Loan Tax Deduction

As the property is registered in joint names and they are co borrowers in the loan document they can both claim rs 2 lakhs as deduction under section 24 b on home loan interest payment and then claim rs 50 000 under section 80ee.

Home loan tax deduction. The tax cuts and jobs act tcja which is in effect from 2018 to 2025 allows homeowners to to deduct interest on home loans up to 750 000. Home loan interest paid up to rs 2 lakh per year is tax deductible u s 24. That means if you made 80 000 during the tax year and claimed 20 000 in deductions then you only have to pay taxes on 60 000. A tax deduction reduces your taxable income.

Additional deductions are available u s 80ee and 80eea. For the 2019 tax year the mortgage interest deduction limit is 750 000 which means homeowners can deduct the interest paid on up to 750 000 in mortgage debt. Most homeowners can deduct all of their mortgage interest. Most homeowners can deduct all their mortgage interest.

Homeowners who bought houses after dec. Mortgage interest deductions are considered itemized. To claim this deduction they should also be co owners of the property taken on loan. Home loan repayment is eligible for tax deductions under the income tax act 1961.

Deduction for joint home loan. How does a home loan help for income tax. 7 deduction for joint home loan if the loan is taken jointly then each of the loan holders can claim a deduction for home loan interest up to rs 2 lakh each and principal repayment u s 80c up to rs 1 5 lakh each in their individual tax returns. The couple would be paying rs 2 77 327 as interest and rs 73 978 as home loan principal payment in a year.

It s subject to some limitations. 15 2017 can deduct interest. Section 80c allows deduction against principal repayment of up to rs 1 5 lakh every year. The mortgage interest deduction is a tax deduction that for mortgage interest paid on the first 1 million of mortgage debt.

In order to utilise the available deductions to the fullest it is advisable to apply for a joint home loan as each person can claim interest deduction up to rs 2 lakh and tax deduction on the principal up to rs 1 5 lakh which doubles the amount of deductions available when compared to a loan taken by a single applicant.