Where do i enter a new loan and points i paid in buying a new rental property in 2018? Entering the data in TT it asked only for recording fees and title insurance.

[AnnetteB]

The mortgage interest will be entered in the Expenses section for your rental property. 

The points will be entered in the Assets/Depreciation section.

[BayAreaAl]

I'm no expert but this is what I did...

With TT Premier 2019, I needed to go to the respective property's assets list (forms view), and enter a new asset as "Loan Points". I couldn't find how to get the interview mechanism to ask for the points paid for the loan.

In this cast the "COST" of the asset is just the points paid.

[Carl]

Costs associated with the acquisition of the property are added to the cost basis of the property and depreciated over time (27.5 years). So they are included in the depreciation of the structure. For example, title transfer fees.

Cost associated with acquisition of the loan are amortized (not capitalized) and deducted (not depreciated) over time. For example, points.

To add your amortizable costs, in the assets/depreciation section select Add An Asset.

Select Intangibles, Other Property and continue.

Select Amortizable Intangibles, and continue.

Describe the Asset, (for example, call it Financing Fees) enter the cost, then the closing date of the loan and continue.

Select Purchased New, then YES used 100% for business, then enter the date the property was "available for rent" and continue.

For Code Section select 163 - Loan Fees and continue.

For Useful Life enter 27.5 (Many say it's 15, but click the blue word "life" on that screen. Then scroll down and you'll see in black and white that it clearly states residentail rental property is 27.5 years) Then continue.

Now on this screen you'll see it says "Years to fully depreciate". That's just a "standard" screen. It's not being depreciated over 27.5 years. It is "in fact" being deducted as it should be. You'll notice the asset category is L-Intangibles and that's what it should be.

[sdarora]

Turbotax is complaing that on Schedule E - Eligible Sec 179 property should not be checked Yes. Only Tangible personal property is eligible for the Section 179 deduction.

This is what TT shows

Check This Entry

Schedule E Worksheet  -- Asset Entry Worksheet (Mortgage Loan Points): Eligible Sec 179 property should not be checked YES. Only tangible personal property is eligible for the Section 179 deduction.

Option 1: No entry Option 2: Eligible Sec 179, Yes Option 3: Eligible Sec 179, No

And on Schedule E line 42 YES is selected

[PatriciaV]

It appears your mortgage loan points were entered as a depreciable asset and not as an intangible. You need to go to the Asset/Depreciation topic, delete the asset entry you made, and re-enter the loan fees in the correct category. 

Mortgage points are categorized by the IRS as an "Amortizable Intangible". You will enter code section 163: Loan Fees as the method to amortize these expenses. These fees are spread over the life of the mortgage (ex: 30 years).

@sdarora