I have a HERO loan in California. The annual payment is on my property taxes and I paid part of my taxes in 2018 and part in 2019.
I think I can deduct the interest portion of the HERO loan. There is no 1098 form from the HERO program. I do have a table provided by the HERO financer that tells me how much the annual interest amount it.
Do I treat the interest deduction like a property tax and claim part in 2018 and part in 2019, do I treat it like a property loan and deduct the interest in the year it was charged, or is there a hidden option #3?
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Although included in the tax bill, the HERO payments are separately stated and not deductible as property tax. But, the portion of the HERO payment that represents interest is generally deductible as home mortgage interest.
I have the same question for 2020.
You may enter the 1098 as if you received one during the year. Do not enter this as a seller-financed loan.
Do I put the balance of the Hero loan as the outstanding mortgage principal or the balance of the home loan?
Enter the mortgage loan balance shown on the 1098 for the Hero Loan.
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