About the Mortgage Interest Deduction Calculator
This mortgage interest deduction calculator estimates how much the US home mortgage interest deduction actually lowers your federal income tax for the 2026 tax year. It works out the interest you pay in a given year of the loan, applies the $750,000 acquisition-debt limit (or $1 million for loans taken out before December 16, 2017), adds deductible points, state and local taxes and other itemized deductions, and compares the total with your standard deduction.
Many homeowners assume every dollar of mortgage interest saves them tax at their marginal rate, but you only benefit from the amount by which your itemized deductions exceed the standard deduction — $32,200 for married couples filing jointly and $16,100 for single filers in 2026. The headline figure here is the extra tax saved because of your mortgage, which is the number that matters when comparing renting and buying or deciding whether to pay a mortgage off early.
The state and local tax (SALT) deduction is capped at $40,400 for 2026 ($20,200 if married filing separately), and the cap shrinks by 30% of modified AGI above $505,000, down to a $10,000 floor; enter your MAGI to apply it. From 2026 the law also limits the tax benefit of itemized deductions for filers in the 37% bracket; the calculator approximates that by valuing their deductions at 35% rather than applying the exact 2/37 reduction. Figures are the 2026 amounts the IRS has published (Rev. Proc. 2025-32 and the 2026 Form 1040-ES). Use it for planning, not filing.
With the default inputs, the tax saved because of your mortgage is $1,247.04. Change any value above to recalculate instantly.
How to use the mortgage interest deduction calculator
- 1Enter the original loan amount, interest rate and term.
- 2Choose which year of the loan you want to estimate (year 1 has the most interest).
- 3Select your filing status and federal marginal tax bracket.
- 4Add points, state and local taxes and other itemized deductions.
- 5Compare the real tax savings with the simple interest × rate estimate.
Formula and method
Interest for the chosen loan year is the sum of the 12 monthly interest charges from the amortization schedule. If the average balance that year exceeds the acquisition-debt limit ($750,000, or $1,000,000 for pre-December 16, 2017 loans; half that if married filing separately), only the ratio limit ÷ average balance of the interest is deductible, as in IRS Publication 936.
Itemized deductions add deductible interest, points, state and local taxes up to the SALT cap (reduced by 30% of MAGI above $505,000, not below $10,000) and other deductions. You take whichever is larger, itemized or standard. For the 37% bracket the savings are figured at 35% as an approximation of the 2026 limit on itemized-deduction benefits. The tax saved because of the mortgage is the difference between your best deduction with and without the mortgage items, multiplied by your marginal rate — which is why many households with moderate mortgages see little or no benefit.
- Itemized
- Mortgage interest + points + capped SALT + other itemized deductions
- Standard
- 2026 standard deduction for your filing status
- Marginal rate
- Federal tax rate on your last dollar of taxable income
Worked examples
$400k loan at 6.5%, married filing jointly, year 1
In year one about $25,868 of interest is paid. With $9,000 SALT and $3,000 other deductions, itemizing gives $37,868 versus the $32,200 standard deduction. Without the mortgage you would take the standard deduction, so the mortgage adds $5,668 of deductions × 22% ≈ $1,247 — not the $5,691 a simple interest × rate estimate suggests.
Single filer, $300k at 7%, $3,000 points, 24% bracket
A single filer pays about $20,903 of interest in year one plus $3,000 of points. Itemized deductions reach $31,903, well above the $16,100 standard deduction. Without the mortgage the $8,000 of other deductions would lose to the standard deduction, so the benefit is ($31,903 − $16,100) × 24% ≈ $3,793.
$1.2M jumbo loan above the $750k limit
The average year-one balance is about $1.194 million, so only $750,000 ÷ $1.194 million ≈ 62.8% of the $80,609 interest — about $50,625 — is deductible. With $600,000 MAGI the SALT cap falls to $40,400 − 30% × $95,000 = $11,900, but that plus $25,000 of charity still beats the standard deduction, so the full deductible interest saves 35%, about $17,719.
Frequently asked questions
Is mortgage interest tax deductible in 2026?+
Yes, if you itemize. Interest on up to $750,000 of debt used to buy, build or substantially improve your main home and one second home is deductible ($375,000 if married filing separately). The 2025 tax law made this limit permanent.
Why does my mortgage not save me any tax?+
You only benefit if your itemized deductions exceed the standard deduction — $32,200 for joint filers and $16,100 for single filers in 2026. If interest plus other deductions fall short, you take the standard deduction and the mortgage adds nothing.
Are mortgage points deductible?+
Points paid to buy or build your main home are generally deductible in full in the year paid if they meet IRS tests. Points on a refinance are usually deducted evenly over the life of the loan instead.
Is interest on a HELOC or home equity loan deductible?+
Only if the money is used to buy, build or substantially improve the home securing the loan, and the total debt stays within the $750,000 limit. Interest on home equity borrowing used for cars, tuition or debt consolidation is not deductible.
What is the SALT cap for 2026?+
The state and local tax deduction is capped at $40,400 for 2026 ($20,200 married filing separately), up from $10,000 before 2025. It is reduced by 30% of modified AGI above $505,000 ($252,500 MFS), but never below $10,000 ($5,000 MFS).
Tax results are estimates based on published rules and simplified assumptions. They are not tax advice — check official guidance or a tax professional for your situation.