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LRichard
New Member

First Home Purchase - Points?

We purchased our first house in 2020. Are all of my closing costs deductible? What are the mortgage points? I see it says they are Origination fee, but what about all the closing costs? title stuff, inspections, insurance, survey, etc. Shouldn't it the 1098 form say the points things too? Also our mortgage got bought and sold throughout the year - went to three different companies. Not refinancing, just transferred. The points thing is just confusing me. Or with is the only thing deductible just the interest one the mortgage?

2 Replies
npierson7
Level 1

First Home Purchase - Points?

You can deduct mortgage interest, points, and property taxes. Other items aren't deductible and have to be added to the house cost basis. You can find more information what is deductible for you here:

 

Deducting Mortgage Interest

 

 

Carl
Level 15

First Home Purchase - Points?

If the property is your primary residence, 2nd home or any other "personal pleasure" use type of property, your only deductible items are the mortgage interest and property taxes.

Any commission you may have paid to a real estate agent reduces your cost basis in the property.

The "points" are just pre-paid mortgage interest that you paid at the closing. Usually the points are included as a part of the origination fees.

Most likely, you also paid a percentage of property taxes at the closing too. So whatever amount if any, property taxes you paid at the closing, then those are a deductible expense also.

All of this should be detailed on the closing statement you received at the actual closing.

 

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