Do I need to report a home purchase on my return?

[rachmccauley0714]

I see information for home sale but not for home purchase.

[GabbyKitty]

If you itemize, there might be some taxes that were part of the transaction you can deduct.

But, in general, there is nothing to report to the IRS about a home purchase.

Be sure to keep all your closing paperwork to document your basis for when you sell.

[Opus 17]

You generally don't report when you buy an asset, only when you sell it.

There are some items associated with the home purchase that are deductible as itemized deductions on schedule A. You can list them in Turbotax, you will only get a tax benefit if your total itemized deductions are larger than your standard deduction.

1. You can deduct the daily mortgage interest from the closing date to the end of the month, this will be shown on your closing statement.  You can deduct this interest even if it is not included on the 1098 from your lender.  If you aren't sure if the daily interest at closing is included in your 1098, compare the interest on your monthly mortgage statements with your 1098.  You can enter this as mortgage interest not on a 1098 (there is a box to check for this) under the name of your closing bank instead of the name of the mortgage servicer, if they are different. 
2. You can deduct property taxes allocated to the days you owned the home.  For example, suppose the seller paid a full year of property taxes on January 15 that covered Jan 1-Dec 31, 2021.  If you bought the home on November 25, you owned the home for 36 days, so you could deduct 36/365=9.86% of the property taxes as if you paid them to the taxing authority yourself.   You will generally give the seller a credit at the closing for the taxes they paid in advance that cover your ownership period, this will be on your closing statement.  You are allowed to deduct the property taxes allocated to your days of ownership as if you paid them to the town or county, even if you did not give such a credit. 
3. If you paid points on the mortgage, you may be able to deduct the entire amount in 2021.  This depends on the financial circumstances of the transaction and Turbotax will ask you questions to guide you through this deduction.  If you can't deduct the points in a lump sum, you will deduct them spread out over the life of the mortgage. 
4. If you paid a lump sum mortgage insurance premium as part of your closing costs, you can deduct this spread out over 84 months, even if it is not shown on a 1098, starting with the month after you closed.  (If you closed in June, you could deduct 6/84th of the lump sum this year, and 12/84s next year, until you use it up.)   Turbotax does not calculate or keep track of the amount of PMI or MIP you can deduct, so you need to keep track of how much you deduct each year until it is used up.   You can add the allocated lump sum to any amount of monthly PMI that is reported on your 1098.  If you paid a VA funding fee for a VA loan, or a guarantee fee to the Rural Housing Service, this is a special type of mortgage insurance and may be deducted fully in the year of the purchase.  Enter this as a "mortgage not reported on a 1098" as described in #1.   
5. Items placed in escrow are not deductible when the escrow account is funded, because is it still your money until the insurance premium or property tax bill is paid.

[Salute2]

You should receive 2 1098 forms, one from each mortgage company. One for the sale and one for the purchase. These 2 forms will communicate the interest, property taxes and mortgage related $$ and dates. You should also complete a schedule contained in Turbo Tax to calculate your capital gains. if any, on the sale of your home. Do a search on "selling My Home"

[DawnC]

No, you do not need to report a home purchase.   As mentioned above, there are some tax breaks available to home owners, most of which are only available to you only if you itemize deductions.   

Mortgage interest

Deducting Points

Real estate taxes

Certain mortgage insurance payments

Qualified energy-saving improvements

What deductions can homeowners take?

Home improvements

Save receipts and records for all significant improvements you make to your home, such as landscaping, storm windows and fencing. You can't deduct these expenses now, but when you sell your home the cost of the improvements is added to the purchase price of your home to determine the cost basis in your home. This will reduce any potential taxable gain that you may have from the sale of your home.