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The payments received under the 403(b) account are taxable in full as ordinary income. In general, the same tax rules apply to distributions from 403(b) plans that apply to distributions from other retirement plans.
This would also make 85% of your SSA and SSDI payments taxable. The VA portion is not effected.
The interest on the mortgage is an allowed deduction on the Schedule A if you itemize along with your property taxes for the year. If you have been itemizing your deductions yo may find that without the interest you are no longer seeing a high enough amount to benefit from itemizing.
If you were at a place in your mortgage that was lower then paying it off might look like a better plan.
There is no good or bad but you have to look at the tax.
I can do an estimate, one sec................................