Points must be amortized over the life of the loan on a refinanced mortgage. Only if the loan was used solely to improve the home can the points be deducted in their entirety in the year of the loan.
As an example, if you paid $3,000 in points to lower your interest rate on a 30 year refinance, you can only deduct 1/30 or $100 of the points in the year of refinance and will continue to deduct $100/year until the loan is paid off or it is refinanced again.
@Chris236
