Mortgage points

Forum|Forum|4 years ago
March 6, 2022
1 reply
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I entered the dollar amount of mortgage points paid (over $1000), but the deduction allowed is only $30. Why is this the case?

RaifH

Level 10

Mortgage points are amortized over the life of the loan unless a portion of the loan was used for an improvement to the house and you meet these requirements.

Amortizing just means taking a portion of the deduction each year. For example, if you have a 30-year mortgage and paid $3,000 in points, your deduction would be $100/year for the next 30 years or until the loan is paid off.

You must amortize the points for a refinance unless you refinance solely to pay for an improvement to your home. TurboTax will automatically calculate the correct deduction based on the points paid and the length of the loan.

Trvls2Much

Level 2

RaifH - your reply does not address the question. I have the same problem. IRS says I'm allowed to deduct all the points for my new primary home loan in the year I paid them (not amortized over the life of the loan). TurboTax is not following the IRS rules - it is forcing amortization even when I meet all the requirements to fully deduct the points.