Where to capture Mortgage points paid towards investment property

[SabrinaD2]

On rental property, points are deductible as an amortizable expense similar to depreciation over the life of the loan.

To capture mortgage points paid towards an investment property in TurboTax, follow these steps:

 

Steps to Enter Mortgage Points

1. To enter your rental improvements, simply follow the directions to enter your rental income and expenses. At some point you'll come across the Here's [your property's] rental property info screen. Under Expenses / Assets (Depreciation), select Add expense or asset and follow the onscreen instructions.
2. Note: Although it doesn't seem logical, refinance fees and mortgage points are also entered in the Expenses / Assets (Depreciation) section. The IRS considers these amortizable intangibles and accounting rules dictate that those are to be depreciated instead of deducted as an expense.

Example Calculation

• Total Points Paid: $3,000
• Loan Term: 30 years
• Annual Amortization: $3,000 / 30 = $100 per year

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