Are you gathering your receipts in preparation for your annual trek to your Accountant’s office in anticipation of tax time? If you bought a home this year, you may have a few new deductions!
Obviously, mortgage interest is a major deduction. Additionally, if there were “points” paid in connection with getting your loan (even if they were paid by the seller), then you may be able to claim a deduction in the year they were paid. This affects your cost basis, and you should discuss it with your CPA.
If you paid “PMI” (private mortgage insurance, which is required by lenders when a borrower makes a down payment less than 20%), you may be able to deduct the payments along with your mortgage interest. There are several restrictions to this – it must be in the acquisition year, and there are income caps when your adjusted gross income exceeds six figures. Check with your CPA for details.
Your settlement agent or REALTOR can get you a copy of your HUD settlement statement, which is handy for a detailed report of the transaction, and a copy should be made for your CPA when he or she prepares your taxes, to make sure no potential deduction is overlooked!
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