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Level 3
posted Apr 11, 2025 2:47:11 PM

Two 1098s, where should the points go or can I deduct them all?

I bought a new home last year, and it was financed through the builder (Lender A). It's a smallish loan, well under the 750K cap, and I have around $5K of points paid that shows up in box 6 of the 1098.

 

Lender A sold the loan a couple weeks after closing to Lender B. Lender B's 1098 says nothing about points.

 

When filing taxes in Turbotax, should the points be logged under Lender A, Lender B, or both? And do I amortize the points over the life of the loan, or deduct them all this year, since I'm using a different lender going forward?

 

Assuming I only amortize the points under Lender A this year (since they are on their 1098), what will I do in the following year, when I only receive a 1098 from Lender B?

 

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7 Replies
Level 15
Apr 11, 2025 2:51:31 PM

Since the loan was sold you report the all of the points paid on your 2024 tax return.  Points logged on from Lender A only.

Level 3
Apr 11, 2025 3:06:57 PM

That seems logical, but I've seen very conflicting information on this forum, which is why I started a new thread. @DDollar @Mike9241  Had different opinions in other threads over the years, with only vaguely different circumstances. Here is one example:

 

Mortgage was sold to new lender. I was amortizing my points with original loan. how do I transfer this amortizing or do I take all the remaining points this year 

 

 

Level 15
Apr 11, 2025 3:18:03 PM

After further review and some research, my original answer was incorrect.

Since you were amortizing the points paid from the original Lender A, you must continue amortizing the points even after Lender B purchased the loan.

 

Level 3
Apr 11, 2025 3:20:38 PM

Thanks, I was leaning towards that, so should I put the points on Lender A or B this year, since it will be on Lender B in following years?

Level 15
Apr 11, 2025 3:23:50 PM

@AndPhoton wrote:

Thanks, I was leaning towards that, so should I put the points on Lender A or B this year, since it will be on Lender B in following years?

Since the points were charged with Lender A they should remain with that lender for tax year 2024.  Assuming that Lender B did not take over the loan until 2025.  For the following tax years amortizing the points would apply through Lender B.

Level 3
Apr 11, 2025 3:27:16 PM

Lender B took over the loan in 2024, 3 weeks after the mortgage origination date with Lender A

Level 15
Apr 11, 2025 3:31:08 PM

@AndPhoton wrote:

Lender B took over the loan in 2024, 3 weeks after the mortgage origination date with Lender A

Oh...OK.  Then they will still be associated with Lender A on the 2024 tax return even though Lender B picked up the loan in 2024.  Next year the points can be associated with Lender B if required.

In the past when points were amortized you only needed to report the amortized amount on Schedule A without reference to any lender.