We refinanced our second home, which is a beach condo from which we earn rental income. Do I treat that as a sale and repurchase? How do I deduct closing costs etc.?

[ToddL99]

No, refinancing the property does not constitute a sale and repurchase.

The following closing costs can be deducted (amortized) over the life of the new mortgage:

• Points
• Loan origination and loan assumption fees
• Mortgage insurance premiums
• Application fees
• Credit report fees
• Appraisal fees (if required by the lender)

See What can I deduct when refinancing rental property? for instructions.

[Carl]

I assume you are reporting this property in the Rental & Royalty Income (SCH E) section of the program on SCH E. Just work through the rental expenses section and when you come to where it asks for your 1098 information, enter the "first" 1098 first (the one for the old loan).

When done, you'll be on a screen with an "add another 1098" button on it. Click that button and work it through for the 2nd 1098 (the one you got for the new loan). PAY ATTENTION TO DETAILS on each and every screen. One of them will have a checkbox on it you will select to indicate that this 2nd 1098 is a refinance. You "MUST" check that box, or your taxes will be wrong and the program will NOT identify your omission as a mistake.