Reporting grants granted during home purchase

[laveeshr]

Hey, 

I bought a new home in June, 2024 and got some grants from my lender worth $15k during the process. Most of those were applied directly to my mortgage during closing. I'm not sure if those grants need to be filed for in any way in the taxes? I didn't get any docs/tax forms from my Lender for this purpose. The only thing that I got from them was a 1098 for reporting the interests that I paid in the year. 

Would appreciate any inputs/advice you can give me here.

Thanks! 

[JamesG1]

If one or more of the grants were considered taxable income, you likely would have been issued an IRS form 1099-MISC by the end of February.

However, retain any records that you kept from your closing should a tax authority have a question about this matter at a later time.

[DawnC]

You can enter your 1098 and may be able to deduct the mortgage interest and taxes if you itemize deductions.   Check with your lender to see if you have any reporting requirements for the grants, but those have probably already been factored in to your mortgage.  

Where do I enter my 1098?  

[Carmen1318]

if my mortgage lender sends me a 1099-NEC form for a $5000 mortgage loan grant, should i contact them and ask them to correct to a 1099-MISC form?  I work a corporate job, received a standard W2 form and am not self-employed.  the 1099-NEC form seems to be more suited for those who are self-employed.  

[Vanessa A]

You can,  but it is possible that they will not correct it.  You are correct, the 1099-NEC is generally for self-employed people, however, many times it is sent to those who are not self-employed. 

If you do not get a 1099-Misc, instead of the 1099-NEC, you can enter the 1099-NEC and keep it from being taxed as Self-Employment by selecting "this is not money earned as an employee or self-employed individual, it is from a sporadic activity or hobby (this is not common) after entering the 1099-NEC in TurboTax.  This is an  This will have it be taxed as your regular income. This is NOT a question that is on the form itself that is sent to the IRS, it is a question in TurboTax to allow the income to be directed to the appropriate form and taxed correctly.