See your real tax savings from the mortgage interest deduction: not the headline number, the actual benefit vs just taking the standard deduction.
Itemizing only helps if your deductions exceed the standard deduction, and for about 9 in 10 households they do not. This calculator does that math honestly, using 2026 standard deductions, the $40,400 SALT cap with its income phase-down, the $750k debt cap, and the new OBBBA rule that makes PMI premiums deductible again from 2026.
Direct answers to the most common questions, in plain language. Skim if you're in a hurry; dig deeper below.
Yes: interest on up to $750,000 of acquisition debt, now permanent.
The One Big Beautiful Bill Act (2025) made the $750,000 acquisition-debt cap ($375,000 married filing separately) permanent, so there is no sunset back to $1M. Loans originated before Dec 16, 2017 keep the grandfathered $1,000,000 cap; this calculator has a toggle for those.
Yes, and roughly 9 in 10 households do not.
The deduction only exists on Schedule A. Your mortgage interest, SALT, PMI, and charity together must beat the standard deduction ($16,100 single / $32,200 married joint in 2026) before a single dollar of interest saves you anything. This calculator shows the honest answer, which is often $0.
Yes, new under OBBBA, with an income phase-out.
Starting tax year 2026, qualified mortgage insurance premiums (PMI and FHA MIP) count as deductible residence interest again, permanently. The deduction phases out 10% for every $1,000 of AGI over $100,000 (gone entirely by $110,000; the phase-out starts at $50,000 married filing separately). Enter your annual premium and AGI to see your share.
$40,400 for 2026, phasing down above $500,000 of MAGI.
OBBBA raised the state-and-local-tax cap from $10,000 to $40,000 for 2025, indexed to $40,400 for 2026. Above $500,000 of MAGI it phases back down (by 30% of the excess) toward a $10,000 floor. The higher cap is the main reason itemizing is back in reach in high-tax states.
The mechanics in short answers. No jargon, no upsell.
On Schedule A, mortgage interest is one of the major itemized deductions. But you must itemize (meaning your total itemized deductions exceed the standard deduction) to claim it.
If your itemized total is $34,200 and the standard deduction is $32,200, your real benefit is only the $2,000 excess × your marginal tax rate.
Interest is deductible on up to $750,000 of mortgage debt for homes bought after Dec 15, 2017 (now permanent). Loans originated earlier keep the grandfathered $1,000,000 cap; the calculator prorates interest above your cap.
OBBBA restored the deduction for qualified mortgage insurance premiums as residence interest, permanently, starting tax year 2026. It phases out 10% per $1,000 of AGI over $100,000, so it is fully gone by $110,000 ($50,000 start if married filing separately).
Worked example: A $400,000 balance at 7% generates $28,000 of interest (fully under the cap). Itemized = $28,000 + $15,000 SALT + $3,000 charity = $46,000 vs the $32,200 married-joint standard deduction. Only the $13,800 excess produces savings: × 24% = $3,312/yr. Add $1,200 of PMI at $95,000 AGI and the excess grows to $15,000, saving $3,600.
Interest is approximated as balance × rate rather than a full amortization schedule, and the comparison against the standard deduction is what most calculators skip: deducting interest only helps to the extent itemizing beats the standard deduction. Estimates only, not tax advice. Everything runs locally in your browser.
Designed so anyone can model their situation in under a minute, with or without a finance background.
Not the headline number, but the actual benefit after the standard deduction floor.
See whether itemizing actually beats the standard deduction for your numbers.
Single, MFJ, head of household: see how marginal rate changes the benefit.
Properly model the $40,400 (2026) state-and-local-tax limit, including the phase-down above $500,000 of income.
From 2026, PMI premiums count as residence interest again. Almost no calculator applies the AGI phase-out; this one does.
Uses 2026 standard deductions, caps, and OBBBA rules, including the grandfathered $1M cap for pre-2018 loans.
Everything you might ask before, during, or after using this tool.
For 2026, federal brackets are roughly: 10%, 12%, 22%, 24%, 32%, 35%, 37%. Your marginal rate is the bracket your last dollar of income falls into. Use a tax bracket calculator or your last 1040 to find it.
$16,100 for single filers, $32,200 for married filing jointly, and $24,150 for head of household. The One Big Beautiful Bill Act of July 2025 made the TCJA-era doubled standard deduction permanent, with annual inflation adjustments, so no sunset is coming.
After the 2017 tax law doubled the standard deduction and capped SALT at $10,000, only ~10% of households itemized. The 2025 law then raised the SALT cap to $40,000 for 2025 and $40,400 for 2026 (phasing back toward $10,000 above $500,000 of MAGI), which makes itemizing viable again for more homeowners in high-tax states. Even so, you typically need a large mortgage balance, high SALT taxes, or significant charitable giving to beat the standard deduction.
A simple rate-and-term refinance keeps your deduction eligibility intact. A cash-out refi only keeps the deduction on the original acquisition debt portion; funds taken out for non-home purposes are NOT deductible.
From tax year 2026, qualified mortgage insurance premiums (PMI on conventional loans, FHA MIP, USDA and VA guarantee fees) are treated as deductible residence interest, permanently under OBBBA. The deduction phases out 10% for every $1,000 of AGI above $100,000, so it disappears entirely at $110,000 ($50,000 phase-out start, $500 steps, if married filing separately). Enter your annual premium and AGI in the calculator; it applies the phase-out and shows exactly how much survives.
Points paid to buy down your rate are typically deductible: fully in the year paid for a home purchase, or amortized over the loan life for a refinance. Add these to your interest figure; the insight card shows what one discount point would be worth at your bracket.
Yes, but they're combined with state and local income/sales taxes under the SALT cap: $40,400 for 2026, phasing down above $500,000 of MAGI. Far fewer households hit the higher cap than the old $10,000 one, so property taxes now count much further toward itemizing.
Mortgage interest on acquisition debt is allowed for AMT, but home equity interest (even for improvements) was disallowed for AMT historically. For most taxpayers in 2026, AMT no longer applies due to higher exemptions.
Yes, but the cap drops to $375,000 of mortgage principal, and both spouses must either itemize or both take the standard. Most MFS couples find this worse than filing jointly.
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The deduction is an itemized deduction on Schedule A; it only matters if your total itemized deductions exceed the standard deduction.
For 2026, that floor is $16,100 (single) / $32,200 (MFJ). Below that, the deduction is mathematically worthless to you.
When it does matter, the value is roughly: (itemized total − standard deduction) × your marginal tax rate. The headline "I paid $15k in mortgage interest, that saves me $3,600!" is almost always wrong.
The 2017 Tax Cuts and Jobs Act roughly doubled the standard deduction AND capped state-and-local-tax deductions at $10,000.
Result: through 2024, even a $400k mortgage at 7% (about $28k of interest year-1) plus a $10k SALT cap rarely beat the MFJ standard deduction.
Itemizers dropped from ~30% of households to ~10% almost overnight.
The One Big Beautiful Bill Act (July 2025) then made the higher standard deduction and the $750k interest cap permanent, and raised the SALT cap to $40,000 for 2025 and $40,400 for 2026, phasing back down above $500,000 of MAGI. The bigger SALT allowance pulls many homeowners in high-tax states back into itemizing; this calculator uses the 2026 numbers.
Between 2007 and 2021, mortgage insurance premiums were intermittently deductible under a provision Congress kept extending and letting lapse. The One Big Beautiful Bill Act ended the on-again-off-again cycle: from tax year 2026, qualified mortgage insurance premiums (conventional PMI, FHA MIP, USDA and VA guarantee fees) count as qualified residence interest, permanently.
The catch is an income phase-out. The deduction shrinks 10% for every $1,000 of AGI over $100,000, hitting zero at $110,000. Married filing separately starts phasing out at $50,000 in $500 steps.
For a buyer paying $1,500 a year of PMI with an AGI of $95,000, the full premium is deductible. At $105,000 of AGI, only half ($750) survives. Above $110,000, nothing does.
For first-time buyers with under 20% down (the people most likely to carry PMI, and most likely to be near the standard-deduction borderline), those few hundred extra dollars of itemized deductions can be exactly what tips itemizing over the line. This calculator models the phase-out and tells you when that happens.
Large mortgages in high-cost areas (e.g., $750k+ at 7%+ → $50k+ interest).
Significant SALT: high state income tax plus property tax now counts up to the $40,400 cap (2026), four times what the old $10k cap allowed.
Big charitable giving on top of housing.
Self-employed or with major unreimbursed medical events.
Outside these scenarios, the standard deduction usually wins.
Don't prepay your mortgage just to "save the deduction"; you save much more by reducing the loan than you ever could on tax savings.
Bunching deductions (concentrating charitable giving every other year) can push some borderline taxpayers above the standard deduction in alternating years.
A donor-advised fund lets you front-load several years of giving into one year to clear the standard deduction floor.
Two short notes worth reading before you trust any number on this page.
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We are not a bank, NBFC, advisor, broker, or distributor of any financial product. The numbers shown here are estimates for educational purposes only, based on the inputs you provide.
Results are not financial, legal, or tax advice. Please consult a qualified professional before any decision about your loan, investments, or personal finances. Actual loan terms and charges depend on your bank and individual circumstances.
