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I prepaid Interest from 01/25/16 to 02/01/16 in the amount of $163.33 which is listed on my Settlement Statement from North American Title. Lender CrossCountry Mortgage

I was told to include this prepaid interest in my tax preparation by CrossCountry Mortgage the original loan lender.
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1 Reply
PaulaM
Expert Alumni

I prepaid Interest from 01/25/16 to 02/01/16 in the amount of $163.33 which is listed on my Settlement Statement from North American Title. Lender CrossCountry Mortgage

Yes, you can enter the amount of interim interest as a deduction under the Your Home section. Enter it as if you received a 1098 form for the prepaid interest.

Other Items on closing disclosure form that may be deductible:

  • Interim interest paid at the time of purchase (the charge at closing would normally be done for interest up to the date of first payment). 
  • real estate taxes charged to you. 
  • points - On a refinance they need to be amortized over the life of the loan; unless the points were used to improve your main home.
  • private mortgage insurance but, if prepaid, only the amount allocable to this year based on an 84 month amortization. 

Other fees, such as commissions, attorney fees, preparation of deed, abstract fees, owner title insurance, recording fees are added to the basis of your home, and not deductible.

https://www.irs.gov/pub/irs-pdf/p936.pdf

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