Multiple 1098s and points

[Brad61]

I took out a new mortgage in 2023 and paid points.  The loan was sold to another lender and now I have two 1098s.  I entered both 1098s in Turbotax, but I'm unsure if I should enter the points on both.  I only paid the points once to the original lender, but the points are listed on both 1098s.

[LindaS5247]

You will enter them one at a time.  Click here for instruction on "How Do I Handle Multiple 1098's?"

Generally, you can deduct the full amount of your points in the year you pay them. (If your mortgage exceeds $750,000 you may be limited).

In order to deduct mortgage points, you must meet the following requirements:

• Mortgage is used to buy or build your primary residence
• Points are a percentage of your mortgage amount
• Using points is a normal business practice where you live
• Points paid is not an excessive amount for where you live
• You are using the cash accounting method on your taxes
• Points are not used for fees such as property taxes
• Funds used to pay for the points were not borrowed
• Points paid must be clearly itemized as points on your loan documents

You may still qualify to deduct them over the life of the loan, if you aren't able to deduct them in the year they are paid.

Click here for "How to Deduct Mortgage Points."