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For the past 5 years I've done taxes for my parents since they were both going to the guy they always went to that was charging them $160 to do their taxes. They both itemize.
This year both of my parents refinanced their homes. They both received a 1098 from both of their lenders. I understand that you can write off the closing costs that are associated with real estate taxes and prepaid interest. Won't the interest already be included in the form 1098? Do I need to account for it elsewhere?
I was thinking of having one of them use a tax preparer this year and I would then duplicate it. That is if there is even any deductions I need to include that aren't part of the 1098.
The form should show the mortgage interest paid, as well as property taxes paid, both of which are deductible, I believe.
I meant to say, won't the interest and property taxes that were included in the closing costs be reported on the 1098's. Basically it's with my understanding that everything I need should already be on the 1098's. I'm just making sure I'm not leaving anything out.
Basically I think any interest in box 1 is deductible in total in 2015. Anything in box 2 has to be amortized over the life of the mortgage. Any real estate taxes shown would also be deductible in 2015.
Look for a free version of Turbo Tax (you can go to the IRS site and look for free software) and see if the software covers refinancing and go through the interview process. This should confirm the above.
Turbo Tax covers this. And yes the info should be on the 1098 form. the mortgage interest, pre-paid points and property taxes are deductible, though the points I believe have to be prorated over the life of the loan. Anyway, TTax would automatically take care of this, just enter the numbers when you follow the prompts.
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