Deductions & credits

You should report the points and daily interest separately. You should not add them to your Form 1098. They go on a separate line on your tax return since they were not on Form 1098.

As far as filing taxes goes, claiming a tax deduction for mortgage points is a fairly straightforward process. Mortgage points are considered an itemized deduction and are claimed on Schedule A of Form 1040. Here are the specifics:

• Usually, your lender will send you Form 1098, showing how much you paid in mortgage points and mortgage interest during the year
• Transfer this amount to line 8a of Form 1040 Schedule A
• If any of your points were not included on Form 1098, enter the additional amount you paid on line 8c of Form 1040 Schedule A

For many taxpayers, the process is this simple. In some cases, though, calculating and deducting mortgage points can be tricky. With TurboTax, just answer a few simple questions and we can help you get the proper deduction for your mortgage points.  The interview section regarding your home purchase will ask you questions to determine this.

Daily interest paid at closing is deductible, but it might not be included in the interest reported on the 1098.  It will be shown on your closing statement.  The interview section regarding your home purchase will ask you questions to determine this.

You can deduct taxes paid on the property for the dates you owned the property, even if you didn't pay the tax directly to the taxing authority.  You can only deduct the portion of taxes that correspond to the dates you owned the property. The interview section regarding your home purchase will ask you questions to determine this.

Buying a home does not necessarily bring you a large refund. Your deductions for homeownership combined with your other deductions must exceed your standard deduction to change your tax due or refund. 

Click here for detailed information regarding buying a home and your taxes.

Click here for information regarding how to deduct mortgage points.