Most homeowners pay property
taxes to a local, state or foreign
government. In most cases,
property taxes are deductible.
They must be charged uniformly
against all property in the jurisdiction
and must be based on the assessed
value. Many states and counties also
impose property taxes for local
improvements to property, such as
assessments for streets, sidewalks,
and sewer lines. These taxes cannot
be deducted.

At the end of each year, your lender
should send you a form 1098.
This form tells you how much you
paid in interest and points during the
year. This is your deductible interest,
provided you meet certain conditions.