Anonymous
Anonymous asked in Business & FinanceTaxesUnited States · 1 decade ago

1 st tax return after buying new house Credit for interest paid?

I bought a house and was told that my interest paid on my mortgage is tax deductable ? How does this work? What else can I claim ? Thanks

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  • Judy
    Lv 7
    1 decade ago
    Best Answer

    You will be able to deduct any mortgage interest paid, and also any property taxes, if you itemize your deductions. The form to itemize is 1040 Schedule A - you can download the form and instructions at irs.gov. It will show you what else you can deduct. Common deductions that most people have are state and local income taxes - if you live someplace that doesn't have those, this year you'll be able to deduct sales tax instead - there's a table for the amounts automatically allowed for that, so you don't have to have receipts. Charitable contributions are also deductible.

    You'll fill out schedule A, then use the total from that instead of the standard deduction as long as it's larger - otherwise you'd just use the standard deduction.

  • 4 years ago

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    1 st tax return after buying new house Credit for interest paid?

    I bought a house and was told that my interest paid on my mortgage is tax deductable ? How does this work? What else can I claim ? Thanks

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  • 1 decade ago

    In the beginning of the year, the bank will send you a statement with the amount of interest you paid them during the last year. You take that to the tax preparer and they'll deduct that amount from your earned income. If you have an office in your house, you can deduct some expenses for that. Ask your tax preparer for a full list of what you can deduct.

  • dcgirl
    Lv 7
    1 decade ago

    You really should see a CPA or an accountant for the first return after buying a house. There are a lot of deductions that a new homeowner can apply and the money you get back by using a professional who knows the laws will be a lot more than what you pay them.

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  • 1 decade ago

    If you use TaxCut or TurboTax, it will ask for this and account for it in your tax return. You will receive a statement from your mortgage co. that will tell you exactly how much interest you have paid as well as any points, if any, that you paid at the time of closing. Points are deductible too, I believe. Good Luck!

  • 1 decade ago

    After the end of the year you should receive a statement from your mortgage company, and yes you get a credit for the interest paid in, not exactly sure how or how much, but you do get something. Hope this helps a little.

  • 1 decade ago

    Yes, the interest is deductible. You will receive a 1098 from the lender and it will show how much you paid in interest and taxes. Then whomever prepares your taxes will use that info to get you deductions for the interest and taxes you paid. As long as the amount is larger than your standard deduction, then you will be able to take advantage of the deductions.

  • skip
    Lv 6
    1 decade ago

    If you are not comfortable interpreting the HUD-1, see a CPA, at least for this year. Sometimes your mortgage statement does not give you all the figures you can claim. You need to refer to the HUD-1. In particular, the property taxes on the mortgage statement may well be understated in the first year.

    This is one thing you do not want to entrust to just any preparer at a chain store.

  • 1 decade ago

    Yes, interest paid is tax deductable. you will get a statement at the end of the year from your mortgage company saying how much that is.

    you can also deduct local property taxes, closing costs, selling costs for your old home, etc. its all on your mortgage statement.

  • 1 decade ago

    It is - wait until you get your 1040 and look for the "Mortgage Interest" section. You won't get credit for all of it but you will get some.

    Also works for

    Med Bills

    Tuition

    Child Care

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