"Don't pay off your mortgage — you'll lose the tax deduction" is one of the most repeated myths in personal finance. The truth: most homeowners get little or no actual benefit, especially after the 2017 Tax Cuts and Jobs Act doubled the standard deduction.
How does the mortgage interest deduction actually work?
You can deduct interest on up to $750,000 of qualified mortgage debt — but only if you itemize. The 2024 standard deduction is $14,600 single / $29,200 married. Most homeowners itemize less than they used to.
Who actually benefits today?
High-income earners with large mortgages and significant other itemized deductions (state taxes, charity). The bottom 80% of homeowners take the standard deduction.
How does this change the early payoff math?
If you do not itemize, every dollar of interest is a real after-tax cost. Paying off your mortgage early saves you the full interest amount. Use our calculator to see real numbers.