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Due to a 2017 reverse mortgage refi, can we deduct Mortgage interest/insurance paid from our 2017 IRS tax return because we received a 1098 from the former lender?

We took out first reverse mortgage in 2015 and due to inflation took advantage of a refi with new lender in 2017 still using reverse mortgage,  Interest is $9400, Insurance is $10500 on the 1098 reported by the first lender.  Our income is more than the total of these deduction amounts.  Are we legally allowed to deduct?

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Due to a 2017 reverse mortgage refi, can we deduct Mortgage interest/insurance paid from our 2017 IRS tax return because we received a 1098 from the former lender?

Yes, since you paid off the first reverse mortgage.

Any interest  accrued on a reverse mortgage is not deductible until you actually pay it ( usually when you pay off the loan in full).  This is what you did when you refinanced.



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Highlighted
Level 1

Due to a 2017 reverse mortgage refi, can we deduct Mortgage interest/insurance paid from our 2017 IRS tax return because we received a 1098 from the former lender?

Yes, since you paid off the first reverse mortgage.

Any interest  accrued on a reverse mortgage is not deductible until you actually pay it ( usually when you pay off the loan in full).  This is what you did when you refinanced.