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Andrew Schwartz CPA
Apr 17, 2008 - 11:55AM
Re: home refinance

While you get to deduct points paid on the purchase of a home, points paid on a refinancing need to be amortized over the life of the mortgage. So if you pay points of $1,500 to refinance to a 15 year mortgage, you get to deduct $100 per year for your points.

Even though the annual tax deduction is minimal, you definitely want to keep track of these points, since if you refinance out of that mortgage down the road, you get to write off the unamortized points.

Please note that if you borrow additional funds and use that money to improve your property, you can write off that portion of your points this year.

Zip Code: 01801

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