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jalandrio
New Member

I bought a house on July 27th 2017. I’m a new homeowner. My tax return is $1,000. I feel like I might have done something wrong in the process.

 
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LinaJ2018
Intuit Alumni

I bought a house on July 27th 2017. I’m a new homeowner. My tax return is $1,000. I feel like I might have done something wrong in the process.

I am providing you with the following guidelines, hope they help!

As buying a new home is not a reportable transaction per IRS, there is no a special section in the TurboTax online program to record the transaction.  However, you are allowed to claim the following deductions related to your home:

1.  Mortgage Interest Expense

2.  Real Estate Taxes

3.  Points

4.  Mortgage Insurance Payments ( if there is any)

At closing, you can deduct mortgage interest, points, and property tax. All other expenses of closing are not deductible. Instead, you add them to the cost basis of your home to reduce the gain when you sell.  You are advised to save the closing statement until you eventually sell your home.

To enter information in TurboTax online program, here are the steps:

After sign into your account and select Take me to my return

1.  On the screen, to your left, select  Federal, from the top, select Deductions and Credits

2.  Scroll down to Your Home, select Mortgage Interest, Refinancing and Insurance  and 

3.  Property ( Real Estate ) Taxes to enter related information

Please note that when you enter itemized deductions such as mortgage interest, property taxes, medical expenses, charitable contributions, all of these items are added together on Schedule A. Unless the total of itemized deductions exceeds the standard deduction for your filing status, you would not see any change in tax due or refund. 

 

For more information, please see this TurboTax Guide to Home Ownership

IRS Pub. 530, Tax Information for Homeowners

http://www.irs.gov/pub/irs-pdf/p530.pdf

and IRS Pub. 523, Selling your home

http://www.irs.gov/pub/irs-pdf/p523.pdf

 

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1 Reply
LinaJ2018
Intuit Alumni

I bought a house on July 27th 2017. I’m a new homeowner. My tax return is $1,000. I feel like I might have done something wrong in the process.

I am providing you with the following guidelines, hope they help!

As buying a new home is not a reportable transaction per IRS, there is no a special section in the TurboTax online program to record the transaction.  However, you are allowed to claim the following deductions related to your home:

1.  Mortgage Interest Expense

2.  Real Estate Taxes

3.  Points

4.  Mortgage Insurance Payments ( if there is any)

At closing, you can deduct mortgage interest, points, and property tax. All other expenses of closing are not deductible. Instead, you add them to the cost basis of your home to reduce the gain when you sell.  You are advised to save the closing statement until you eventually sell your home.

To enter information in TurboTax online program, here are the steps:

After sign into your account and select Take me to my return

1.  On the screen, to your left, select  Federal, from the top, select Deductions and Credits

2.  Scroll down to Your Home, select Mortgage Interest, Refinancing and Insurance  and 

3.  Property ( Real Estate ) Taxes to enter related information

Please note that when you enter itemized deductions such as mortgage interest, property taxes, medical expenses, charitable contributions, all of these items are added together on Schedule A. Unless the total of itemized deductions exceeds the standard deduction for your filing status, you would not see any change in tax due or refund. 

 

For more information, please see this TurboTax Guide to Home Ownership

IRS Pub. 530, Tax Information for Homeowners

http://www.irs.gov/pub/irs-pdf/p530.pdf

and IRS Pub. 523, Selling your home

http://www.irs.gov/pub/irs-pdf/p523.pdf

 

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