The mortgage interest deduction (MID) allows homeowners to deduct a portion of their mortgage interest from taxable income, potentially lowering their tax bracket. Eligible loans include private mortgages and government-backed loans. The deduction applies to the first $750,000 of mortgage debt, with higher limits for older loans. To claim the MID, taxpayers must itemize deductions and use Form 1098 if they paid over $600 in interest. Refinancing options are available to reduce future interest payments.
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