Tax Deductibility Of Interest And Points


Definition of "Tax Deductibility (of Interest and Points)"

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The provision of the U.S. tax code that allows homeowners to deduct mortgage interest payments from income before computing taxes. Points and origination fees are also deductible, but not lender fees expressed in dollars or any other settlement costs. Interest deductibility is politically untouchable in the U.S., although it is often criticized by economists and is found in few other countries. Interest deductibility enters a number of decisions made by homeowners or purchasers, sometimes when it shouldn't.

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