Steve Work lost $6,862 of his mortgage interest deductions the easy way: a lack of knowledge combined with a lack of proof.
Lack of knowledge. Work used life insurance money to buy his home. He paid interest on the loan and deducted that interest as home mortgage interest. Wrong, ruled the court, explaining that the home must secure the loan on which you claim the home mortgage deduction; therefore, the life insurance loan interest was not deductible as home mortgage ... Log in to view full article.