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Everyone is not always right. For you to get a tax advantage, the total of your itemized deductions must be more than the standard deduction. If you bought the house during the year, you did not have a full year of mortgage interest and property taxes to deduct. It may benefit you next year when you have a full year of deductions.
Even with a full year, not all tax payers have enough deductions to total more than the standard deduction.
Did you enter any deductible expenses paid at closing that were not included on the 1098?
Most expenses at closing on the purchase or refinance of a home are added to the cost of a home and are not deductible but are added to the cost basis of the home. There are a few exceptions - the following would be deductible:
1. Interest paid at the time of purchase (the charge at closing would normally be done for interest up to the date of first payment.) This is sometimes included in the 1098 from the new lender.
2. Real estate taxes charged to you and not reimbursed by seller
3. Points or origination fees. On a refinance they need to be amortized over the life of the loan unless the points were used to improve your main home.
4. Private mortgage insurance costs but, if prepaid, only the amount allocable to this year based on an 84 month amortization.
Title fees, real estate commissions, documentary stamps, credit report costs, costs of an abstract, transfer taxes, attorney fees, etc. are not deductible, but are added to the cost of the property.
Everyone is not always right. For you to get a tax advantage, the total of your itemized deductions must be more than the standard deduction. If you bought the house during the year, you did not have a full year of mortgage interest and property taxes to deduct. It may benefit you next year when you have a full year of deductions.
Even with a full year, not all tax payers have enough deductions to total more than the standard deduction.
Did you enter any deductible expenses paid at closing that were not included on the 1098?
Most expenses at closing on the purchase or refinance of a home are added to the cost of a home and are not deductible but are added to the cost basis of the home. There are a few exceptions - the following would be deductible:
1. Interest paid at the time of purchase (the charge at closing would normally be done for interest up to the date of first payment.) This is sometimes included in the 1098 from the new lender.
2. Real estate taxes charged to you and not reimbursed by seller
3. Points or origination fees. On a refinance they need to be amortized over the life of the loan unless the points were used to improve your main home.
4. Private mortgage insurance costs but, if prepaid, only the amount allocable to this year based on an 84 month amortization.
Title fees, real estate commissions, documentary stamps, credit report costs, costs of an abstract, transfer taxes, attorney fees, etc. are not deductible, but are added to the cost of the property.
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