Reverse Mortgage Form 1098

DonB10 · ‎April 11, 2022

I originated a Reverse Mortgage on my condo unit in 2006 and received a Form 1098 for tax year 2021 from Champion Mortgage, the holder of my reverse mortgage. Can I claim any of the information on this form like monthly interest, monthly Mortgage Insurance Premium or monthly Service Fee as a deduction on my 2021 tax return?

DonB

ColeenD3 · ‎April 11, 2022

No. A reverse mortgage is a loan where the lender pays you (in a lump sum, a monthly advance, a line of credit, or a combination of all three) while you continue to live in your home. With a reverse mortgage, you retain title to your home. Depending on the plan, your reverse mortgage becomes due with interest when you move, sell your home, reach the end of a pre-selected loan period, or die. Because reverse mortgages are considered loan advances and not income, the amount you receive isn't taxable. Any interest (including original issue discount) accrued on a reverse mortgage is considered interest on home equity debt and isn’t deductible.

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ColeenD3 · ‎April 11, 2022

No. A reverse mortgage is a loan where the lender pays you (in a lump sum, a monthly advance, a line of credit, or a combination of all three) while you continue to live in your home. With a reverse mortgage, you retain title to your home. Depending on the plan, your reverse mortgage becomes due with interest when you move, sell your home, reach the end of a pre-selected loan period, or die. Because reverse mortgages are considered loan advances and not income, the amount you receive isn't taxable. Any interest (including original issue discount) accrued on a reverse mortgage is considered interest on home equity debt and isn’t deductible.