It depends if you need to actually enter the refinance cost yourself, or if the program does it "for you". I am assuming you refinanced this property while it was classified as a rental, and not while it was your primary residence, 2nd home, or other "personal use" type. Lots of information here. So don't try to absorb it all at once. I'll present it in pieces, so you can deal with it in pieces.
As you know, refi costs are amortized (not capitalized) and deducted (not depreciated) over the life of the loan.So you may first need to deal with your finance cost from the original loan.
- Basically, if you refinanced with a *different* lender, then any remaining financing cost from that original lender are fully deductible on your 2020 tax return. If this is your case, let me know and I'll provide you the property way to do this in the TurboTax program.
- If you refinanced with the same lender, then your financing cost on the original loan are "not" fully deductible in the year you refi with that same lender. You just leave those costs alone and they will continue to amortize over the remaining life span of that original loan, "as if" you did not refinance.
Now, check the list of assets in the Assets/Depreication section and make sure that the refinancing cost for the "new" loan are "in fact" not there. If they are there, you're done and can stop reading now. Otherwise....
-On the Your Property Assets" screen click the Add an Asset button.
- Select Intangibles, Other Property and continue.
- Select Amortizable Intangibles, and continue.
- Describe this Asset: Enter something like "refinancing loan costs"
- Cost: Enter the total of your refi costs
- Date purchased or acquired: Enter the closing date of the new loan.
- Click continue
- Select that you purchased this asset new, and that it was used 100% for this business. Then enter the closing date of the loan and click continue.
- For the code section, select 163:Loan Fees and then continue.
- Useful life in years is the term of the loan. Typically this will be 15 years or 30 years. Then continue.
- This puts you on the Asset Summary screen. You can see the details here if you like. But you "MUST" click the DONE button on this screen, in order to actually save this entry.
That does it.
