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New Member

Closing Disclosure: “Origination Fees” or “Origination Charges”?

Origination charges not shown on 1098, so I’m referring to my Closing Disclosure.  Some articles/posts use the terminology “Origination Fees” or “Origination Charges”.  Turbo Tax asks for “Origination Charges”. Under my Closing Disclosure, “Origination Charges” include Condo Review fee, Extended Lock fee, Loan Administration fee, Loan Origination fee, non-refundable application fee and Processing fee.  Can I deduct this $##,### “Origination Charges” number or is it just the $#,### “Loan Origination fee” number?  I’m confused with which one to input in Turbo Tax.
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New Member

Closing Disclosure: “Origination Fees” or “Origination Charges”?

You can deduct just the Loan Origination Fee (also called points). If it's your primary residence you can deduct the full amount, but if you refinanced, then you will deduct the fee over the term of the loan or the life of the loan (just the origination fees, not the total closing costs). For example, if you refinanced to a 15-year mortgage, then you'd deduct a portion of the origination fees or points each year for 15 years. 

The closing costs are not deductible, they just add to your basis (cost of residence) and can be used later to offset any gains you have from the sale of your house.

To enter the loan origination fees (“points”) in TurboTax, please follow the steps:

  • Personal
  • Deductions & Credits
  • Your Home
  • Mortgage Interest, Refinancing, and Insurance, Click Start
  • Did you pay any home loans in 2017? Click Continue
  • Who's your mortgage lender? Click Continue
  • Do any of these uncommon situations apply to your loan with __ ? Click Continue
  • Let's get the details from your __  1098 now Click Continue
  • Did you take out this loan in 2017? Click Continue
  • Did you pay points in 2017 when you took out the loan?, select I paid points when I purchased or refinanced to improve my main home in 2017. 
  • If not a main home, then select, I paid points when I refinanced, purchased a second home, or opened a home equity loan in 2017.
  • Depending on what you choose, whether it was you main home or not, you will be able to include your loan origination costs information.
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