Home loans

You are only partially correct. According to IRS publication 936, generally the points on a refinance must be amortized.  If the loan is sold you keep amortizing,  however if you pay it off (even if by refinancing,  you claim the remaining points all at once.  TTAX handles this ok.  There however another exception which the TTax help referred to and was my case.  If you get extra money to be used to upgrade, modify, remodel your home that portion of the points is fully deductible in the first year. E.g. You refinance $250,000 and get an additional $50,000 (total $300,000) to remodel and upgrade your home and pay 3000 points. You can deduct 50000/300000x3000 = 3000/6 = $500 the first year.  The remainder ($2500) you must amortize.   TTax does  not handle this and furthermore won't let you handle it manually using the forms to override it. (Maybe someone  else can do it, but the online help person didn't even know what I was talking about) 

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