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Answers (10)
- Hamp Yonce, "Zilluminati"
- Contributions:3463
I was about to ask goodrunner to name the Dufus that told him that. Thanks Clay.
I swear I think Zillow has hired some college kids to make these questions up. Traffic has tanked, and they need this forum to make the CIC auction ziz wheel turn. Where did all the "my quote request was so inadequate I didn't get any responses" people used to go? Away?
I swear I think Zillow has hired some college kids to make these questions up. Traffic has tanked, and they need this forum to make the CIC auction ziz wheel turn. Where did all the "my quote request was so inadequate I didn't get any responses" people used to go? Away?
- Clay Branch, "Georgia Loans"
- Contributions:7835
Goodrunner, the answer is no, period. You are doing a rate and term refi so there is no same year write off for points. Any points that can be written off are divided by the term, spread over 15 years if a 15 Yr fixed, 20 years if a 20 Yr Fxd, 30 years on 99% of all Arms, etc. You probably understand the IRS guidelines posted but if not, call the IRS and they will tell you. In addition to someone telling you to write off the points on your next tax filing, they described a tax credit and not a tax deduction which are completely different things. Even if this was a purchase and you could write all points in 1 year, you would not even come close to getting $5400 back ( that would be a tax credit like 1st time homebuyers are getting right now ). It would simply offset paying taxes on $5400 of your income and since you dont pay a 100% tax rate, it is impossible. Are you using a Zillow lender?
- lifebeyondEarth
- Contributions:97
GR,
To put in perspective - Yes/No.
If you paid points on your loan let's say 3000 on a 30 year note
its tax deductible 3000/30 = 100 per year.
However, if you refinanced this loan with a new loan, you can deduct all 3000 in that year ( its the life of the loan) + If you paid any points on your new loan divided by term of the loan.
- Robert Benham, "FHA down to 620 OK!"
- Contributions:776
I thought flow charts were supposed to make things easier....
Just proves you can answer any mortgage related question with the answer,.....it's depends.
Just proves you can answer any mortgage related question with the answer,.....it's depends.
- Clay Branch, "Georgia Loans"
- Contributions:7835
Agreed, and do away with paying a 2nd funding fee if it was paid the 1st time around.
- Hamp Yonce, "Zilluminati"
- Contributions:3463
I know, I just liked the convoluted way it was presented, and then thought no wonder they would rather have Clay tell em. For free. CIC's baby, it's all about interaction.
PS A Veteran should be able to deduct all CC's, IMAO!
PS A Veteran should be able to deduct all CC's, IMAO!
- Clay Branch, "Georgia Loans"
- Contributions:7835
Nice chart Hamp, and under that info is this info:
Points that do not meet these requirements may be deductible over the life of the loan. Points paid for refinancing generally can only be deducted over the life of the new mortgage. However, if you use part of the refinanced mortgage proceeds to improve your main home and you meet the first six requirements stated previously, you can fully deduct the part of the points related to the improvement in the year you paid them with your own funds. Points charged for specific services, such as preparation costs for a mortgage note, appraisal fees or notary fees are not interest and cannot be deducted. Points paid by the seller of a home cannot be deducted as interest on the seller's return, but they are a selling expense which will reduce the amount of gain realized. Points paid by the seller may be deducted by the buyer provided the buyer subtracts the amount from the basis, or cost, of the residence. Points you pay on loans secured by your second home can be deducted only over the life of the loan.
Points that do not meet these requirements may be deductible over the life of the loan. Points paid for refinancing generally can only be deducted over the life of the new mortgage. However, if you use part of the refinanced mortgage proceeds to improve your main home and you meet the first six requirements stated previously, you can fully deduct the part of the points related to the improvement in the year you paid them with your own funds. Points charged for specific services, such as preparation costs for a mortgage note, appraisal fees or notary fees are not interest and cannot be deducted. Points paid by the seller of a home cannot be deducted as interest on the seller's return, but they are a selling expense which will reduce the amount of gain realized. Points paid by the seller may be deducted by the buyer provided the buyer subtracts the amount from the basis, or cost, of the residence. Points you pay on loans secured by your second home can be deducted only over the life of the loan.
- Hamp Yonce, "Zilluminati"
- Contributions:3463
The IRS says.
- Clay Branch, "Georgia Loans"
- Contributions:7835
No, on a refinance those points are deducted over the term of the loan. If you are getting a 30 Yr fixed then you could write off 1/30th per year. Even if you were par with the Govt and could deduct them in 1 year, the actual cash realized would be $5400 x your tax rate, say 28%, or $1512, not $5400.
- Anthony Ebright, "anthonyebright"
- Contributions:15
goodrunner,
This is a question you should ask your tax accountant. He or she would know about these rules better than anyone else.
Anthony
This is a question you should ask your tax accountant. He or she would know about these rules better than anyone else.
Anthony
Are points paid on a mortgage loan to refinance fully tax deductible in the year paid?
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