turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
Announcements
Close icon
Do you have a TurboTax Online account?

We'll help you get started or pick up where you left off.

My 1098 says $0 the points paid in box 6, but the closing statement shows a Temporary Buydown Fee under the section for Loan Charges. Does this count as points?

 
x
Do you have an Intuit account?

Do you have an Intuit account?

You'll need to sign in or create an account to connect with an expert.

1 Reply
maglib
Level 10

My 1098 says $0 the points paid in box 6, but the closing statement shows a Temporary Buydown Fee under the section for Loan Charges. Does this count as points?

The home mortgage industry uses two types of points, origination points and discount points. Origination points are typically income for the loan originator, while discount points are a type of prepaid interest and are often fully deductible.

Yes,  you can deduct points for your main home, if all of the following conditions apply:

  • They're discount points (see the definition).
  • The mortgage is used to buy, build, or improve the home, and the home is the collateral for the loan.
  • Paying mortgage points is a customary practice in your area and the points you paid aren't excessive for your neighborhood.
  • The points were paid directly to the lender, either by you or the seller
  • Your down payment, plus any points the seller paid, exceed the points paid amount.
  • You use the cash method of accounting (almost all taxpayers do).
  • The points are calculated as a percentage of the mortgage principal (not required on home-improvement loans).
  • The points are clearly itemized on your settlement statement as points (not required on home-improvement loans).

If you meet all the above criteria, you can either deduct all your points in the year you paid them or deduct them in equal increments over the life of the loan. Either way, you'll need to itemize to get the deduction.

Mortgage points are considered an itemized deduction and are claimed on Schedule A of Form 1040. Here are the specifics:

  • Usually, your lender will send you Form 1098, showing how much you paid in mortgage points and mortgage interest
  • If any of your points were not included on Form 1098, you enter the additional amount you paid on line 12 of Form 1040 Schedule A

How to enter in TT (note there will be a question if not reported to you on a 1098):  https://ttlc.intuit.com/questions/2900844-where-do-i-enter-my-1098-mortgage-interest-statement

**I don't work for TT. Just trying to help. All the best.
***Say "Thanks" by marking as BEST ANSWER and clicking the thumb icon in a post and that I solved your question
**Mark the post that answers your question by clicking on "Mark as Best Answer"
I am NOT an expert and you should confirm with a tax expert.

Unlock tailored help options in your account.

message box icon

Get more help

Ask questions and learn more about your taxes and finances.

Post your Question