Can I use anything on my HUD-1 Settlement Statement as a tax deduction?

Tips and Deals Forums Buying Your Home Can I use anything on my HUD-1 Settlement Statement as a tax deduction?

Viewing 2 reply threads
  • Author
    Posts
    • #207739
      Anonymous
      Inactive

      I bought the home in April 2006.

    • #264696
      Anonymous
      Inactive

      The closing statement is packed with pertinent tax information. Many of the items are either taxes or interest, the rest affect the basis of the property. It might not be deductible to you now, but could be in the case the property becomes an income property or Congress changes the laws again. Warning: the IRS is required to “amortize” points over the length of the loan, the tax code doesn’t say that, making it a grey area. If the amount of points paid is significant, go see a professional.

    • #277374

      Points for the mortgage. They should be on the 1098 your received from the lender, though, so don’t add them if they were.

      Property taxes credited to the seller are considered as paid by you and should be added to any other property taxes you paid in the year of closing. Property taxes credited to you are considered paid by the seller and should be subtracted from any property taxes you pay in the year of closing.

      Prepaids (other than mortgage interest, which will show up on the 1098) have no tax consequences, they are just deposits towards future bills.

      All other closing costs on your side of the HUD-1 can be added to your basis for the home. This will reduce your gain on sale when you eventually do sell.

Viewing 2 reply threads
  • You must be logged in to reply to this topic.
Register New Account
Reset Password