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Closing Disclosure - What is deductible?

As I understand, there are 4 items to note on a closing disclosure document (formerly HUD-1) that are deductible:

1. Prepaid Interest

2. Prepaid Taxes

3. Points

4. Mortgage Insurance Premiums

-Where are you able to deduct these items (Schedule A)?

-If the lender also issues a 1098, how do you know whether or not the interest and taxes (paid through escrow) were also included on the closing disclosure?

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Level 2

Closing Disclosure - What is deductible?

If you purchased a new home, the Prepaid Interest, Prepaid Taxes and Points are all itemized deductions.  

  • Enter them in your Federal return, on the tab for Deductions & Credits, topic Your Home.  
  • Click on Show more and choose the subject Mortgage Interest, Refinancing, and Insurance (Form 1098) for the interest and points, 
  • and the subject Property (Real Estate) Taxes for your prepaid taxes.  
  • Mortgage Insurance Premiums are currently not deductible under the Tax Cuts & Jobs Act of 2017.

Generally, the information from the closing disclosure is separate from the information on the 1098 for your mortgage.  If you have questions on what's included on the 1098, it's best to call your lender for that information.

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