IRS acknowledges per-taxpayer interpretation of mortgage interest deduction limits

Historic_home_in_Poplar_Lawn_Historic_DistrictThe IRS has announced that it will follow the decision in Voss v. Commissioner, which specifies that two unmarried individuals purchasing a residence together can each deduct interest on a mortgage up to $1 million and home equity debt up to $100,000.

As such, unmarried co-owners are collectively limited to a deduction for interest paid on a maximum of $2.2 million, rather than $1.1 million, of acquisition and home equity indebtedness.