You cannot immediately deduct the $500 you paid for the appraisal from your taxes if you have a reverse mortgage. Most closing costs and fees, including appraisals, aren't immediately deductible because, unlike a regular mortgage, you usually don't pay interest on a reverse mortgage until the loan is paid back. This reverse mortgage closing costs guide was very beneficial to me in understanding the associated costs.
Some of these expenses might be regarded as loan "points" and might even be amortized and deducted at the time of loan repayment if you ultimately pay interest when the loan is paid back (for instance, after selling the house). There isn't currently a deduction to include on your 2024 tax return.
