How to write off points and refinance expenses?

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Subject Author Date How to write off points and refinance expenses? John Johnson 04-05-2009  Re: How to write off points and refinance expenses... Arthur Kamlet 04-05-2009
Posted by John Johnson on April 5, 2009, 6:28 pm Please log in for more thread options In 2008 I refinanced my second home, that is occupied by my daughter (not rental) for about $400,000. The expenses consisted of about 2 points, title, insurance, fees, notary, etc. but I did not pay anything out of my pocket (except appraisal). From the new loan amount they paid off the original loan of about $120,000, about $15,000 in points and expenses, and the difference of $265,000 was directly deposited in my bank account. From the money received by direct deposit, I paid off two other loans on two small industrial condominiums. Were my proceeds $280,000 or $265,000? How can I write off the points and refinance expenses? Your help is greatly appreciated. Thank a lot! John -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Arthur Kamlet on April 5, 2009, 9:51 pm Please log in for more thread options >In 2008 I refinanced my second home, that is occupied by my daughter (not >rental) for about $400,000. The expenses consisted of about 2 points, >title, insurance, fees, notary, etc. but I did not pay anything out of my >pocket (except appraisal). From the new loan amount they paid off the >original loan of about $120,000, about $15,000 in points and expenses, and >the difference of $265,000 was directly deposited in my bank account. From >the money received by direct deposit, I paid off two other loans on two >small industrial condominiums. Were my proceeds $280,000 or $265,000? How >can I write off the points and refinance expenses? Your help is greatly >appreciated. The portion of the loan which replacd the emainin acquisition debt principal is itself acquisition debt, and the $1million loan limit applies. The remainder if any is home equity debt and interest on up to 100,000 is deductible for regular (not AMT) tax. Points paid, assuming a different lender, are amortized over the life of the loan. -- ArtKamlet at a o l dot c o m Columbus OH K2PZH -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Similar Threads Posted Points on refinance deductible if cash out used to renovate? January 24, 2008, 8:31 am Refinance points paid from the loan amount! April 3, 2009, 11:51 am Rental Refinance Tax deduction February 19, 2007, 2:20 pm IRS To Help Homeowners Refinance Or Sell Homes December 16, 2008, 11:31 pm Cash out refinance and investment property August 28, 2009, 1:33 am Deducting Points March 3, 2007, 4:29 am points deductible? March 12, 2007, 4:54 am Points or loan fees February 13, 2007, 2:08 am Mortgage Credit on Points February 4, 2008, 6:42 pm Mortgage origination fee "expressed as points"? February 14, 2010, 8:26 pm