You should have been given this information during the closing of your home purchase. Remember that you have to be liable for repayment of the loan to deduct mortgage interest. If you pay your son's or daughter's mortgage to help them out, for example, you cannot deduct the interest unless you co-signed the loan. You can deduct a late payment charge as home mortgage interest as long as the charge was not for a specific service you received in connection with your mortgage loan.
If you pay off your home mortgage early and you're required to pay a prepayment penalty, you may deduct that penalty as home mortgage interest as long as the charge was not for a specific service you received in connection with your mortgage loan. When you buy a house, you often have to pay points to the lender to get your mortgage. These points can usually be deducted as prepaid interest.
Other terms for points are:. You may deduct any points you pay, or points your seller paid on your behalf, in the year in which you pay the points, if you meet all of these requirements:.
Some points do not meet these criteria. They may still be deductible, but you have to deduct them over the life of the loan. You can deduct annual real estate taxes based on the assessed value of your property by your city or state. Caution: Don't deduct your payments into your escrow account as real estate taxes. Your deposits are simply money put aside to cover tax payments. You should deduct only the actual property tax payments made from the account by your lender during the year.
You can't deduct charges for services to a specific property or for specific people even if the payments are made to the taxing authority in your area. Examples include:.
Through , if you pay mortgage insurance premiums on a qualifying policy issued after , you can generally deduct the premiums as additional mortgage interest. Claim the deduction on Line 8d of Schedule A. The deduction is phased out for incomes greater than this. The amount of PMI that you pay for the year can be found on Form , which you receive from your mortgage lender. Save receipts and records for all significant improvements you make to your home, such as landscaping, storm windows and fencing.
You can't deduct these expenses now, but when you sell your home the cost of the improvements is added to the purchase price of your home to determine the cost basis in your home. While the deductibility of PMI premiums has been an on-again, off-again affair for years, homeowners are again in luck, as it is "on again" through tax year The tax deduction for PMI premiums or Mortgage Insurance Premiums MIP for FHA-backed loans is not part of the tax code, but since the financial crisis has generally been authorized by Congress as parts of other bills and "extended" to cover the most recent tax year.
That's the case for tax year , but this may change in the future. The "extenders" in the "Further Consolidated Appropriations Act, " also made PMI premiums retroactively deductible for the tax year , which they previously weren't.
If you filed with itemized deductions on Schedule A back in , you might consider filing an amended tax return , to capture the MI deduction for that year, if it is worth it in your situation. In general, the IRS says you have three years from the date you originally filed to file an amended return.
You can find the amount of mortgage insurance premiums you paid on the Form that your lender or servicer sends to you each year. If married, the spouse must also have been a U. For information about nonresidents or dual-status aliens, please see International Taxpayers. Conclusions are based on information provided by you in response to the questions you answered.
Lenders can require PMI for a number of other reasons, too. It protects the lender against potential losses if you stop making mortgage payments. The cost of PMI can vary widely. For example, in Texas PMI can range from 0. The cost depends on several factors, including the type of loan, down payment amount, loan term and your credit, according to the Texas Department of Insurance.
PMI, along with other eligible forms of mortgage insurance premiums, was tax deductible only through the tax year as an itemized deduction. But with the passage of the Further Consolidated Appropriations Act, , Congress extended the deduction through Dec.
The mortgage insurance premium deduction allows you to deduct amounts you paid during the tax year or that applied to the tax year if you prepaid. Adjusted gross income is your gross income all the income you receive in a year minus adjustments.
AGI is the basis for calculating your taxable income, which in turn determines your tax bracket and tax rate. Learn more about AGI. In January , Rep.
0コメント