1157756
In 2019 I refinanced my mortgage. I tried to enter the 1098 for the original mortgage which is now paid off, but I get to a point where I must pick one of:
* Yes, this is a loan I've refinanced or a home equity line of credit
* No, this is the original loan I used to buy or build my home.
This phrasing does not seem to make grammatical sense to me. The loan is the original loan, and also it has been refinanced. Both are true, yet I must only pick one.
Can someone help me through this confusing phrasing?
Thanks,
-- Ethan
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If you are talking about the 1098 for the original mortgage then you pick
No, this is the original loan I used to buy or build my home
If you are talking about the 1098 for the original mortgage then you pick
No, this is the original loan I used to buy or build my home
And then for the new mortgage in 2019 which refinanced the original mortgage of 2017, I choose "Yes, this is a loan I've refinanced or a home equity line of credit"?
It seems like strange phrasing, but I'll go with it. "A loan I've refinanced" seems to me to mean a loan which has since been refinanced and closed out.
I've seen some answers to the refinanced mortgages but never what was selected on the next page. I home was valued at $270,000.00. The I refinanced $160,000.00 and paid off all my bills. The only debt I have is the house mortgage. The next page asked "have you ever pulled cash out from this loan you refinanced?. I did not refinance $270,000.00, merely refinanced and used excess monies to pay off debt. Is that considered a Home Equity Line of Credit? Are they trying to get me to pay taxes on the money that I paid off my bills with?
Thanks in advance.
Cary
Your situation might be complicated enough that you should either review IRS Pub 936 yourself or speak to someone.
https://www.irs.gov/pub/irs-pdf/p936.pdf
There are lots (and lots) of rules about how to decide how much of a mortgage's interest is deductible.
I think the question is asking about the case where you have an existing mortgage that you eliminate by taking out a new mortgage. The new mortgage is only deductible up to the amount of the original mortgage. But often people take a new mortgage at a higher amount because the value of their home has gone up, and they're qualified for more. Then you get "cash out" of the new mortgage after it pays off the original. That amount of the new mortgage is not deductible.
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