Do I get a tax break If I pay down my mortgage?

Question

I want to put my money where the IRS can't get at it. Can I pay down my mortgage? Does that give me any breaks? Or...

Answer 1

What kind of tax break?  You will not get a tax break paying down your mortgage, that is just your money being transferred from cash to equity.  You can get a break on interest if you put money in an IRA which is tax deferred, but you have to pay tax on either the money you put in now (Roth IRA) if it is income, or later on the interest on a standard IRA.

Answer 2

what kind of money is it that you are worried about the IRS getting? if it's income - you can't do anything except pay the taxes on it (which are are less than 100% so you do wind up with most of it) - paying down a mortgage will end the mortgage sooner, giving you access to the money you used to use making monthly payments

Answer 3

No, there's no tax break for that.  However, paying down your mortgage will save you a TON in interest payments over the years.  In virtually all cases the interest that you save will be MUCH more money than the tax savings of the mortgage interest deduction.

If you can invest the money for a higher rate of return than your mortgage interest rate, keep the mortgage.  If not, pay off the mortgage as quickly as you can.

Answer 4

You can pay down your mortgage, but since any extra payments will go to principal, not additional interest, you won't get any extra deduction from doing that.

Answer 5

No.  Paying down your mortgage means early repayment of the principal.  Why would you expect a "tax break" for that?