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I've read IRS pub. 936 but I would like to be sure if my computation is acurate.

In early 1999 we took out a home equity loan ( appx 125%) LTV. I think that I understand how to compute this but I am not sure.

Here is a rough breakdown.

Amount owed on First
Mortgage 80,600

Fair Market Value 102,000

Amt of Home Equity
Loan 31,260

Tell me if this right: I think that means that I can deduct the interest on the Home Eq Loan up to the amount of the FMV (102,000-80,600) which is 21,400. The rest of the home equity loan is personal interest. I divided 21400 into the 31260 and got 68% and some change. Does that mean that 68% of my interest pd on my home equity loan is deductible? If I paid $4500 in interest on the 2nd or Home eq. would $3080 be deductable? If so, what line does that go on (Schedule A?)
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