To enter mortgage interest:
Per IRS Publication 17 Your Federal Income Tax (For Individuals), page 168:
Note. I Interest on home equity loans and lines of credit are deductible only if the borrowed funds are used to buy, build, or substantially improve the taxpayer's home that secures the loan. As under prior law, the loan must be secured by the taxpayer's main home or second home (qualified residence), not exceed the cost of the home, and meet other requirements.
In most cases, you can deduct all of your home mortgage interest. How much you can deduct depends on the date of the mortgage,the amount of the mortgage, and how you use the mortgage proceeds.
Fully deductible interest. If all of your mortgages fit into one or more of the following three categories at all times during the year, you can deduct all of the interest on those mortgages. (If any one mortgage fits into more than one category, add the debt that fits in each category toyour other debt in the same category.)
The three categories are as follows:
The dollar limits for the second and third categories apply to the combined mortgages on your main home and second home.
See Part II of Pub. 936 for more detailed definitions of grandfathered debt and home acquisition debt.
You can use Figure 24-A (on page 169 of IRS Publication 17) to check whether your home mortgage interest is fully deductible.
Note. You must be legally liable for the mortgage in order to deduct the mortgage interest.