Can I Claim Mortgage Interest/Expenses on my US taxes?

I am buying a house in Germany that will be my primary residence and I am wanting to know if I can claim the mortgage interest/expenses on my US taxes. I do own another house in Kentucky that I am claiming the interest but it is being rented.

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Half of Mortgage Principal and Interest as Alimony Paid.

by Christopher
(Colorado)

Hello and thank you for this service,

I've been divorced in Colorado since February 2009. My former spouse and I still own a home in joint tenancy in Colorado. It's a qualified home because I live in the residence. My former spouse lives elsewhere. I must and do pay the entire mortgage payment (principal, interest, tax and insurance) each month. According to IRS Publication 17 and 504, it appears that I’m allowed to deduct half of the principal and interest payments as alimony paid, while the former spouse must claim those as alimony received. The former spouse and I can each deduct half of the interest payments on Schedule A. Plus, I can deduct 100% of the real estate taxes on Schedule A.

Yet some accountants and lawyers believe that this interpretation of alimony paid versus received only applies if the non-paying spouse resides in the qualified home. However, I've seen nothing from the IRS that substantiates that view. What's your view? Is it proper for me to deduct half of the principal and interest payments as alimony paid as well as take all the other aforementioned deductions? If I’m wrong, would you be kind enough to direct me to the IRS source, such as a publication, that verifies your interpretation?

Thank you.

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Interest on Construction Loan

Question for Tax Year 2010: In 2010 I had a construction loan with one bank for several months to build a second home. Later, I went to closing a second time to convert to a regular, 30-year mortgage (with points) with another bank. I advertised the basement of this second home for rent in November 2010 but did not find a suitable renter until March 2011.

1)On Schedule E for this rental section for Tax Year 2010, can I claim a pro-rated portion of the entire interest from the construction loan as well as 1/30 of interest and points from the regular 30-year mortgage?

2) What about mileage to and from the two mortgage closing? Can I deduct a pro-rated portion of the entire mileage?

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Interest Rate Lock Fee In Tax Return

by Dhruv
(Huntsville, AL)

I paid some amount last year(2010) to lock the interest rate to the lending bank. Can I show the lock fee in the tax return? If yes, how?

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