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Turbotax 2012

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Turbotax 2012

Turbotax 2012 Publication 505 - Introductory Material Table of Contents IntroductionNonresident aliens. Turbotax 2012 Ordering forms and publications. Turbotax 2012 Tax questions. Turbotax 2012 What's New for 2014 Reminders Introduction The federal income tax is a pay-as-you-go tax. Turbotax 2012 You must pay the tax as you earn or receive income during the year. Turbotax 2012 There are two ways to pay as you go. Turbotax 2012 Withholding. Turbotax 2012 If you are an employee, your employer probably withholds income tax from your pay. Turbotax 2012 In addition, tax may be withheld from certain other income, such as pensions, bonuses, commissions, and gambling winnings. Turbotax 2012 The amount withheld is paid to the Internal Revenue Service (IRS) in your name. Turbotax 2012 Estimated tax. Turbotax 2012 If you do not pay your tax through withholding, or do not pay enough tax that way, you might have to pay estimated tax. Turbotax 2012 People who are in business for themselves generally will have to pay their tax this way. Turbotax 2012 You may have to pay estimated tax if you receive income such as dividends, interest, capital gains, rents, and royalties. Turbotax 2012 Estimated tax is used to pay not only income tax, but other taxes such as self-employment tax and alternative minimum tax. Turbotax 2012 This publication explains both of these methods. Turbotax 2012 It also explains how to take credit on your return for the tax that was withheld and for your estimated tax payments. Turbotax 2012 If you did not pay enough tax during the year, either through withholding or by making estimated tax payments, you may have to pay a penalty. Turbotax 2012 Generally, the IRS can figure this penalty for you. Turbotax 2012 This underpayment penalty, and the exceptions to it, are discussed in chapter 4. Turbotax 2012 Nonresident aliens. Turbotax 2012    Before completing Form W-4, nonresident alien employees should see the Instructions for Form 8233, Exemption From Withholding on Compensation for Independent (and Certain Dependent) Personal Services of a Nonresident Alien Individual. Turbotax 2012 Also see chapter 8 of Publication 519, U. Turbotax 2012 S. Turbotax 2012 Tax Guide for Aliens, for important information on withholding. Turbotax 2012 What's new for 2013 and 2014. Turbotax 2012   See What's New for 2014 in this Introduction, and What's New for 2013 in chapter 4. Turbotax 2012 Comments and suggestions. Turbotax 2012   We welcome your comments about this publication and your suggestions for future editions. Turbotax 2012   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. Turbotax 2012 NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. Turbotax 2012 Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. Turbotax 2012   You can send your comments from www. Turbotax 2012 irs. Turbotax 2012 gov/formspubs/. Turbotax 2012 Click on “More Information” and then on Give us feedback on forms and publications. Turbotax 2012   Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax products. Turbotax 2012 Ordering forms and publications. Turbotax 2012   Visit www. Turbotax 2012 irs. Turbotax 2012 gov/formspubs/ to download forms and publications, call 1-800-TAX-FORM (1-800-829-3676), or write to the address below and receive a response within 10 business days after your request is received. Turbotax 2012 Internal Revenue Service 1201 N. Turbotax 2012 Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. Turbotax 2012   If you have a tax question, check the information available on IRS. Turbotax 2012 gov or call 1-800-829-1040. Turbotax 2012 We cannot answer tax questions sent to either of the above addresses. Turbotax 2012 What's New for 2014 Use your 2013 tax return as a guide in figuring your 2014 estimated tax, but be sure to consider the following. Turbotax 2012 Standard mileage rates. Turbotax 2012  The 2014 rate for business use of your vehicle is 56 cents per mile. Turbotax 2012 The rate for use of your vehicle to get medical care or move is 23½ cents per mile. Turbotax 2012 The rate of 14 cents per mile for charitable use is unchanged. Turbotax 2012 Personal exemption increased for certain taxpayers. Turbotax 2012  For 2014, the personal exemption amount is increased to $3,950 for taxpayers with adjusted gross income at or below $305,050 if married filing jointly or qualifying widow(er), $279,650 if head of household, $254,200 if single, or $152,525 if married filing separately. Turbotax 2012 The personal exemption amount for taxpayers with adjusted gross income above these thresholds may be reduced. Turbotax 2012 Limitation on itemized deductions. Turbotax 2012  For 2014, itemized deductions for taxpayers with adjusted gross income above $305,050 if married filing jointly or qualifying widow(er), $279,650 if head of household, $254,200 if single, and $152,525 if married filing separately may be reduced. Turbotax 2012 Health care coverage. Turbotax 2012  When you file your 2014 tax return in 2015, you will need to either (1) indicate on your return that you and your family had health care coverage throughout 2014, (2) claim an exemption from the health care coverage requirement for some or all of 2014, or (3) make a payment if you do not have coverage or an exemption(s) for all 12 months of 2014. Turbotax 2012 For examples on how this payment works, go to www. Turbotax 2012 IRS. Turbotax 2012 gov/aca and click under the “Individuals & Families” section. Turbotax 2012 You may want to consider this when figuring your “Other taxes” on Line 12 of the 2014 Estimated Tax Worksheet (Worksheet 2-1). Turbotax 2012 For general information on these requirements, go to www. Turbotax 2012 IRS. Turbotax 2012 gov/aca. Turbotax 2012 Advance payments of the Premium Tax Credit. Turbotax 2012  If you buy health care insurance through the Health Insurance Marketplace, you may be eligible for advance payments of the Premium Tax Credit to help pay for your insurance coverage. Turbotax 2012 Receiving too little or too much in advance will affect your refund or balance due. Turbotax 2012 Promptly report changes in your income or family size to your Marketplace. Turbotax 2012 You may want to consider this when figuring your estimated taxes for 2014. Turbotax 2012 For more information, go to www. Turbotax 2012 IRS. Turbotax 2012 gov/aca and see Publication 5120 and Publication 5121. Turbotax 2012 http://www. Turbotax 2012 IRS. Turbotax 2012 gov/pub5120 Alternative minimum tax (AMT) exemption amount increased. Turbotax 2012  The AMT exemption amount is increased to $52,800 ($82,100 if married filing jointly or qualifying widow(er); $41,050 if married filing separately). Turbotax 2012 Lifetime learning credit income limits. Turbotax 2012  In order to claim a lifetime learning credit, your MAGI must be less than $54,000 ($108,000 if married filing jointly). Turbotax 2012 Retirement savings contribution credit income limits increased. Turbotax 2012  In order to claim this credit for 2014, your MAGI must be less than $30,000 ($60,000 if married filing jointly; $45,000 if head of household). Turbotax 2012 Adoption credit or exclusion. Turbotax 2012  The maximum adoption credit or exclusion for employer-provided adoption benefits has increased to $13,190. Turbotax 2012 In order to claim either the credit or exclusion, your MAGI must be less than $237,880. Turbotax 2012 Earned income credit (EIC). Turbotax 2012  You may be able to take the EIC in 2014 if: Three or more children lived with you and you earned less than $46,997 ($52,427 if married filing jointly), Two children lived with you and you earned less than $43,756 ($49,186 if married filing jointly), One child lived with you and you earned less than $38,511 ($43,941 if married filing jointly), or A child did not live with you and you earned less than $14,590 ($20,020 if married filing jointly). Turbotax 2012 Also, the maximum MAGI you can have and still get the credit has increased. Turbotax 2012 You may be able to take the credit if your MAGI is less than the amount in the above list that applies to you. Turbotax 2012 The maximum investment income you can have and get the credit has increased to $3,350. Turbotax 2012 Reminders Future developments. Turbotax 2012  The IRS has created a page on IRS. Turbotax 2012 gov for information about Publication 505 at www. Turbotax 2012 irs. Turbotax 2012 gov/pub505. Turbotax 2012 Information about any future developments affecting Publication 505 (such as legislation enacted after we release it) will be posted on that page. Turbotax 2012 Social security tax. Turbotax 2012   Generally, each employer for whom you work during the tax year must withhold social security tax up to the annual limit. Turbotax 2012 The annual limit is $117,000 in 2014. Turbotax 2012 Photographs of missing children. Turbotax 2012  The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Turbotax 2012 Photographs of missing children selected by the Center may appear in this publication on pages that otherwise would be blank. Turbotax 2012 You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child. Turbotax 2012 Additional Medicare Tax. Turbotax 2012  Beginning in 2013, a 0. Turbotax 2012 9% Additional Medicare Tax applies to Medicare wages, Railroad Retirement Tax Act compensation, and self-employment income over a threshold amount based on your filing status. Turbotax 2012 You may need to include this amount when figuring your estimated tax. Turbotax 2012 See the instructions for line 12 of the 2014 Estimated Tax Worksheet. Turbotax 2012 You may also request that your employer deduct and withhold an additional amount of income tax withholding from your wages on Form W-4, Employee's Withholding Allowance Certificate. Turbotax 2012 For more information on Additional Medicare Tax, go to IRS. Turbotax 2012 gov and enter “Additional Medicare Tax” in the search box. Turbotax 2012 Net Investment Income Tax. Turbotax 2012  Beginning in 2013, you may be subject to Net Investment Income Tax (NIIT). Turbotax 2012 NIIT is a 3. Turbotax 2012 8% tax on the lesser of net investment income or the excess of your modified adjusted gross income (MAGI) over the threshold amount. Turbotax 2012 NIIT may need to be included when figuring estimated tax. Turbotax 2012 See the instructions for line 12 of the 2014 Estimated Tax Worksheet. Turbotax 2012 You may also request that your employer deduct and withhold an additional amount of income tax withholding from your wages on Form W-4. Turbotax 2012 For more information on NIIT, go to IRS. Turbotax 2012 gov and enter “Net Investment Income Tax” in the search box. Turbotax 2012 Prev  Up  Next   Home   More Online Publications
 
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The Turbotax 2012

Turbotax 2012 23. Turbotax 2012   Interest Expense Table of Contents Introduction Useful Items - You may want to see: Home Mortgage InterestAmount Deductible Points Mortgage Insurance Premiums Form 1098, Mortgage Interest Statement Investment InterestInvestment Property Allocation of Interest Expense Limit on Deduction Items You Cannot DeductPersonal Interest Allocation of Interest How To ReportMore than one borrower. Turbotax 2012 Mortgage proceeds used for business or investment. Turbotax 2012 Introduction This chapter discusses what interest expenses you can deduct. Turbotax 2012 Interest is the amount you pay for the use of borrowed money. Turbotax 2012 The following are types of interest you can deduct as itemized deductions on Schedule A (Form 1040). Turbotax 2012 Home mortgage interest, including certain points and mortgage insurance premiums. Turbotax 2012 Investment interest. Turbotax 2012 This chapter explains these deductions. Turbotax 2012 It also explains where to deduct other types of interest and lists some types of interest you cannot deduct. Turbotax 2012 Use Table 23-1 to find out where to get more information on various types of interest, including investment interest. Turbotax 2012 Useful Items - You may want to see: Publication 936 Home Mortgage Interest Deduction 550 Investment Income and Expenses Home Mortgage Interest Generally, home mortgage interest is any interest you pay on a loan secured by your home (main home or a second home). Turbotax 2012 The loan may be a mortgage to buy your home, a second mortgage, a line of credit, or a home equity loan. Turbotax 2012 You can deduct home mortgage interest if all the following conditions are met. Turbotax 2012 You file Form 1040 and itemize deductions on Schedule A (Form 1040). Turbotax 2012 The mortgage is a secured debt on a qualified home in which you have an ownership interest. Turbotax 2012 (Generally, your mortgage is a secured debt if you put your home up as collateral to protect the interest of the lender. Turbotax 2012 The term “qualified home” means your main home or second home. Turbotax 2012 For details, see Publication 936. Turbotax 2012 )  Both you and the lender must intend that the loan be repaid. Turbotax 2012 Amount Deductible In most cases, you can deduct all of your home mortgage interest. Turbotax 2012 How much you can deduct depends on the date of the mortgage, the amount of the mortgage, and how you use the mortgage proceeds. Turbotax 2012 Fully deductible interest. Turbotax 2012   If all of your mortgages fit into one or more of the following three categories at all times during the year, you can deduct all of the interest on those mortgages. Turbotax 2012 (If any one mortgage fits into more than one category, add the debt that fits in each category to your other debt in the same category. Turbotax 2012 )   The three categories are as follows: Mortgages you took out on or before October 13, 1987 (called grandfathered debt). Turbotax 2012 Mortgages you took out after October 13, 1987, to buy, build, or improve your home (called home acquisition debt), but only if throughout 2013 these mortgages plus any grandfathered debt totaled $1 million or less ($500,000 or less if married filing separately). Turbotax 2012 Mortgages you took out after October 13, 1987, other than to buy, build, or improve your home (called home equity debt), but only if throughout 2013 these mortgages totaled $100,000 or less ($50,000 or less if married filing separately) and totaled no more than the fair market value of your home reduced by (1) and (2). Turbotax 2012 The dollar limits for the second and third categories apply to the combined mortgages on your main home and second home. Turbotax 2012   See Part II of Publication 936 for more detailed definitions of grandfathered, home acquisition, and home equity debt. Turbotax 2012    You can use Figure 23-A to check whether your home mortgage interest is fully deductible. Turbotax 2012 Figure 23-A. Turbotax 2012 Is My Home Mortgage Interest Fully Deductible? Please click here for the text description of the image. Turbotax 2012 Figure 23-A. Turbotax 2012 Is My Interest Fully Deductible? Limits on deduction. Turbotax 2012   You cannot fully deduct interest on a mortgage that does not fit into any of the three categories listed earlier. Turbotax 2012 If this applies to you, see Part II of Publication 936 to figure the amount of interest you can deduct. Turbotax 2012 Special Situations This section describes certain items that can be included as home mortgage interest and others that cannot. Turbotax 2012 It also describes certain special situations that may affect your deduction. Turbotax 2012 Late payment charge on mortgage payment. Turbotax 2012   You can deduct as home mortgage interest a late payment charge if it was not for a specific service performed in connection with your mortgage loan. Turbotax 2012 Mortgage prepayment penalty. Turbotax 2012   If you pay off your home mortgage early, you may have to pay a penalty. Turbotax 2012 You can deduct that penalty as home mortgage interest provided the penalty is not for a specific service performed or cost incurred in connection with your mortgage loan. Turbotax 2012 Sale of home. Turbotax 2012   If you sell your home, you can deduct your home mortgage interest (subject to any limits that apply) paid up to, but not including, the date of sale. Turbotax 2012 Example. Turbotax 2012 John and Peggy Harris sold their home on May 7. Turbotax 2012 Through April 30, they made home mortgage interest payments of $1,220. Turbotax 2012 The settlement sheet for the sale of the home showed $50 interest for the 6-day period in May up to, but not including, the date of sale. Turbotax 2012 Their mortgage interest deduction is $1,270 ($1,220 + $50). Turbotax 2012 Prepaid interest. Turbotax 2012   If you pay interest in advance for a period that goes beyond the end of the tax year, you must spread this interest over the tax years to which it applies. Turbotax 2012 You can deduct in each year only the interest that qualifies as home mortgage interest for that year. Turbotax 2012 However, there is an exception that applies to points, discussed later. Turbotax 2012 Mortgage interest credit. Turbotax 2012   You may be able to claim a mortgage interest credit if you were issued a mortgage credit certificate (MCC) by a state or local government. Turbotax 2012 Figure the credit on Form 8396, Mortgage Interest Credit. Turbotax 2012 If you take this credit, you must reduce your mortgage interest deduction by the amount of the credit. Turbotax 2012   For more information on the credit, see chapter 37. Turbotax 2012 Ministers' and military housing allowance. Turbotax 2012   If you are a minister or a member of the uniformed services and receive a housing allowance that is not taxable, you can still deduct your home mortgage interest. Turbotax 2012 Hardest Hit Fund and Emergency Homeowners' Loan Programs. Turbotax 2012   You can use a special method to compute your deduction for mortgage interest and real estate taxes on your main home if you meet the following two conditions. Turbotax 2012 You received assistance under: A State Housing Finance Agency (State HFA) Hardest Hit Fund program in which program payments could be used to pay mortgage interest, or An Emergency Homeowners' Loan Program administered by the Department of Housing and Urban Development (HUD) or a state. Turbotax 2012 You meet the rules to deduct all of the mortgage interest on your loan and all of the real estate taxes on your main home. Turbotax 2012 If you meet these tests, then you can deduct all of the payments you actually made during the year to your mortgage servicer, the State HFA, or HUD on the home mortgage (including the amount shown on box 3 of Form 1098-MA, Mortgage Assistance Payments), but not more than the sum of the amounts shown on Form 1098, Mortgage Interest Statement, in box 1 (mortgage interest received from payer(s) / borrower(s)), box 4 (mortgage insurance premiums) and box 5 (real property taxes). Turbotax 2012 However, you are not required to use this special method to compute your deduction for mortgage interest and real estate taxes on your main home. Turbotax 2012 Mortgage assistance payments under section 235 of the National Housing Act. Turbotax 2012   If you qualify for mortgage assistance payments for lower-income families under section 235 of the National Housing Act, part or all of the interest on your mortgage may be paid for you. Turbotax 2012 You cannot deduct the interest that is paid for you. Turbotax 2012 No other effect on taxes. Turbotax 2012   Do not include these mortgage assistance payments in your income. Turbotax 2012 Also, do not use these payments to reduce other deductions, such as real estate taxes. Turbotax 2012 Divorced or separated individuals. Turbotax 2012   If a divorce or separation agreement requires you or your spouse or former spouse to pay home mortgage interest on a home owned by both of you, the payment of interest may be alimony. Turbotax 2012 See the discussion of Payments for jointly-owned home in chapter 18. Turbotax 2012 Redeemable ground rents. Turbotax 2012   If you make annual or periodic rental payments on a redeemable ground rent, you can deduct them as mortgage interest. Turbotax 2012   Payments made to end the lease and to buy the lessor's entire interest in the land are not deductible as mortgage interest. Turbotax 2012 For more information, see Publication 936. Turbotax 2012 Nonredeemable ground rents. Turbotax 2012   Payments on a nonredeemable ground rent are not mortgage interest. Turbotax 2012 You can deduct them as rent if they are a business expense or if they are for rental property. Turbotax 2012 Reverse mortgages. Turbotax 2012   A reverse mortgage is a loan where the lender pays you (in a lump sum, a monthly advance, a line of credit, or a combination of all three) while you continue to live in your home. Turbotax 2012 With a reverse mortgage, you retain title to your home. Turbotax 2012 Depending on the plan, your reverse mortgage becomes due with interest when you move, sell your home, reach the end of a pre-selected loan period, or die. Turbotax 2012 Because reverse mortgages are considered loan advances and not income, the amount you receive is not taxable. Turbotax 2012 Any interest (including original issue discount) accrued on a reverse mortgage is not deductible until the loan is paid in full. Turbotax 2012 Your deduction may be limited because a reverse mortgage loan generally is subject to the limit on Home Equity Debt discussed in Publication 936. Turbotax 2012 Rental payments. Turbotax 2012   If you live in a house before final settlement on the purchase, any payments you make for that period are rent and not interest. Turbotax 2012 This is true even if the settlement papers call them interest. Turbotax 2012 You cannot deduct these payments as home mortgage interest. Turbotax 2012 Mortgage proceeds invested in tax-exempt securities. Turbotax 2012   You cannot deduct the home mortgage interest on grandfathered debt or home equity debt if you used the proceeds of the mortgage to buy securities or certificates that produce tax-free income. Turbotax 2012 “Grandfathered debt” and “home equity debt” are defined earlier under Amount Deductible. Turbotax 2012 Refunds of interest. Turbotax 2012   If you receive a refund of interest in the same tax year you paid it, you must reduce your interest expense by the amount refunded to you. Turbotax 2012 If you receive a refund of interest you deducted in an earlier year, you generally must include the refund in income in the year you receive it. Turbotax 2012 However, you need to include it only up to the amount of the deduction that reduced your tax in the earlier year. Turbotax 2012 This is true whether the interest overcharge was refunded to you or was used to reduce the outstanding principal on your mortgage. Turbotax 2012    If you received a refund of interest you overpaid in an earlier year, you generally will receive a Form 1098, Mortgage Interest Statement, showing the refund in box 3. Turbotax 2012 For information about Form 1098, see Form 1098, Mortgage Interest Statement , later. Turbotax 2012   For more information on how to treat refunds of interest deducted in earlier years, see Recoveries in chapter 12. Turbotax 2012 Points The term “points” is used to describe certain charges paid, or treated as paid, by a borrower to obtain a home mortgage. Turbotax 2012 Points may also be called loan origination fees, maximum loan charges, loan discount, or discount points. Turbotax 2012 A borrower is treated as paying any points that a home seller pays for the borrower's mortgage. Turbotax 2012 See Points paid by the seller , later. Turbotax 2012 General Rule You generally cannot deduct the full amount of points in the year paid. Turbotax 2012 Because they are prepaid interest, you generally deduct them ratably over the life (term) of the mortgage. Turbotax 2012 See Deduction Allowed Ratably , next. Turbotax 2012 For exceptions to the general rule, see Deduction Allowed in Year Paid , later. Turbotax 2012 Deduction Allowed Ratably If you do not meet the tests listed under Deduction Allowed in Year Paid , later, the loan is not a home improvement loan, or you choose not to deduct your points in full in the year paid, you can deduct the points ratably (equally) over the life of the loan if you meet all the following tests. Turbotax 2012 You use the cash method of accounting. Turbotax 2012 This means you report income in the year you receive it and deduct expenses in the year you pay them. Turbotax 2012 Most individuals use this method. Turbotax 2012 Your loan is secured by a home. Turbotax 2012 (The home does not need to be your main home. Turbotax 2012 ) Your loan period is not more than 30 years. Turbotax 2012 If your loan period is more than 10 years, the terms of your loan are the same as other loans offered in your area for the same or longer period. Turbotax 2012 Either your loan amount is $250,000 or less, or the number of points is not more than: 4, if your loan period is 15 years or less, or 6, if your loan period is more than 15 years. Turbotax 2012 Deduction Allowed in Year Paid You can fully deduct points in the year paid if you meet all the following tests. Turbotax 2012 (You can use Figure 23-B as a quick guide to see whether your points are fully deductible in the year paid. Turbotax 2012 ) Your loan is secured by your main home. Turbotax 2012 (Your main home is the one you ordinarily live in most of the time. Turbotax 2012 ) Paying points is an established business practice in the area where the loan was made. Turbotax 2012 The points paid were not more than the points generally charged in that area. Turbotax 2012 You use the cash method of accounting. Turbotax 2012 This means you report income in the year you receive it and deduct expenses in the year you pay them. Turbotax 2012 (If you want more information about this method, see Accounting Methods in chapter 1. Turbotax 2012 ) The points were not paid in place of amounts that ordinarily are stated separately on the settlement statement, such as appraisal fees, inspection fees, title fees, attorney fees, and property taxes. Turbotax 2012 The funds you provided at or before closing, plus any points the seller paid, were at least as much as the points charged. Turbotax 2012 The funds you provided are not required to have been applied to the points. Turbotax 2012 They can include a down payment, an escrow deposit, earnest money, and other funds you paid at or before closing for any purpose. Turbotax 2012 You cannot have borrowed these funds from your lender or mortgage broker. Turbotax 2012 You use your loan to buy or build your main home. Turbotax 2012 The points were computed as a percentage of the principal amount of the mortgage. Turbotax 2012 The amount is clearly shown on the settlement statement (such as the Settlement Statement, Form HUD-1) as points charged for the mortgage. Turbotax 2012 The points may be shown as paid from either your funds or the seller's. Turbotax 2012 Figure 23-B. Turbotax 2012 Are My Points Fully Deductible This Year? Please click here for the text description of the image. Turbotax 2012 Figure 23-B. Turbotax 2012 Are My Points Fully Deductible This Year? Note. Turbotax 2012 If you meet all of these tests, you can choose to either fully deduct the points in the year paid, or deduct them over the life of the loan. Turbotax 2012 Home improvement loan. Turbotax 2012   You can also fully deduct in the year paid points paid on a loan to improve your main home, if tests (1) through (6) are met. Turbotax 2012 Second home. Turbotax 2012 You cannot fully deduct in the year paid points you pay on loans secured by your second home. Turbotax 2012 You can deduct these points only over the life of the loan. Turbotax 2012 Refinancing. Turbotax 2012   Generally, points you pay to refinance a mortgage are not deductible in full in the year you pay them. Turbotax 2012 This is true even if the new mortgage is secured by your main home. Turbotax 2012   However, if you use part of the refinanced mortgage proceeds to improve your main home and you meet the first 6 tests listed under Deduction Allowed in Year Paid , earlier, you can fully deduct the part of the points related to the improvement in the year you paid them with your own funds. Turbotax 2012 You can deduct the rest of the points over the life of the loan. Turbotax 2012 Example 1. Turbotax 2012 In 1998, Bill Fields got a mortgage to buy a home. Turbotax 2012 In 2013, Bill refinanced that mortgage with a 15-year $100,000 mortgage loan. Turbotax 2012 The mortgage is secured by his home. Turbotax 2012 To get the new loan, he had to pay three points ($3,000). Turbotax 2012 Two points ($2,000) were for prepaid interest, and one point ($1,000) was charged for services, in place of amounts that ordinarily are stated separately on the settlement statement. Turbotax 2012 Bill paid the points out of his private funds, rather than out of the proceeds of the new loan. Turbotax 2012 The payment of points is an established practice in the area, and the points charged are not more than the amount generally charged there. Turbotax 2012 Bill's first payment on the new loan was due July 1. Turbotax 2012 He made six payments on the loan in 2013 and is a cash basis taxpayer. Turbotax 2012 Bill used the funds from the new mortgage to repay his existing mortgage. Turbotax 2012 Although the new mortgage loan was for Bill's continued ownership of his main home, it was not for the purchase or improvement of that home. Turbotax 2012 He cannot deduct all of the points in 2013. Turbotax 2012 He can deduct two points ($2,000) ratably over the life of the loan. Turbotax 2012 He deducts $67 [($2,000 ÷ 180 months) × 6 payments] of the points in 2013. Turbotax 2012 The other point ($1,000) was a fee for services and is not deductible. Turbotax 2012 Example 2. Turbotax 2012 The facts are the same as in Example 1, except that Bill used $25,000 of the loan proceeds to improve his home and $75,000 to repay his existing mortgage. Turbotax 2012 Bill deducts 25% ($25,000 ÷ $100,000) of the points ($2,000) in 2013. Turbotax 2012 His deduction is $500 ($2,000 × 25%). Turbotax 2012 Bill also deducts the ratable part of the remaining $1,500 ($2,000 − $500) that must be spread over the life of the loan. Turbotax 2012 This is $50 [($1,500 ÷ 180 months) × 6 payments] in 2013. Turbotax 2012 The total amount Bill deducts in 2013 is $550 ($500 + $50). Turbotax 2012 Special Situations This section describes certain special situations that may affect your deduction of points. Turbotax 2012 Original issue discount. Turbotax 2012   If you do not qualify to either deduct the points in the year paid or deduct them ratably over the life of the loan, or if you choose not to use either of these methods, the points reduce the issue price of the loan. Turbotax 2012 This reduction results in original issue discount, which is discussed in chapter 4 of Publication 535. Turbotax 2012 Amounts charged for services. Turbotax 2012   Amounts charged by the lender for specific services connected to the loan are not interest. Turbotax 2012 Examples of these charges are: Appraisal fees, Notary fees, and Preparation costs for the mortgage note or deed of trust. Turbotax 2012 You cannot deduct these amounts as points either in the year paid or over the life of the mortgage. Turbotax 2012 Points paid by the seller. Turbotax 2012   The term “points” includes loan placement fees that the seller pays to the lender to arrange financing for the buyer. Turbotax 2012 Treatment by seller. Turbotax 2012   The seller cannot deduct these fees as interest. Turbotax 2012 But they are a selling expense that reduces the amount realized by the seller. Turbotax 2012 See chapter 15 for information on selling your home. Turbotax 2012 Treatment by buyer. Turbotax 2012    The buyer reduces the basis of the home by the amount of the seller-paid points and treats the points as if he or she had paid them. Turbotax 2012 If all the tests under Deduction Allowed in Year Paid , earlier, are met, the buyer can deduct the points in the year paid. Turbotax 2012 If any of those tests are not met, the buyer deducts the points over the life of the loan. Turbotax 2012   For information about basis, see chapter 13. Turbotax 2012 Funds provided are less than points. Turbotax 2012   If you meet all the tests in Deduction Allowed in Year Paid , earlier, except that the funds you provided were less than the points charged to you (test (6)), you can deduct the points in the year paid, up to the amount of funds you provided. Turbotax 2012 In addition, you can deduct any points paid by the seller. Turbotax 2012 Example 1. Turbotax 2012 When you took out a $100,000 mortgage loan to buy your home in December, you were charged one point ($1,000). Turbotax 2012 You meet all the tests for deducting points in the year paid, except the only funds you provided were a $750 down payment. Turbotax 2012 Of the $1,000 charged for points, you can deduct $750 in the year paid. Turbotax 2012 You spread the remaining $250 over the life of the mortgage. Turbotax 2012 Example 2. Turbotax 2012 The facts are the same as in Example 1, except that the person who sold you your home also paid one point ($1,000) to help you get your mortgage. Turbotax 2012 In the year paid, you can deduct $1,750 ($750 of the amount you were charged plus the $1,000 paid by the seller). Turbotax 2012 You spread the remaining $250 over the life of the mortgage. Turbotax 2012 You must reduce the basis of your home by the $1,000 paid by the seller. Turbotax 2012 Excess points. Turbotax 2012   If you meet all the tests in Deduction Allowed in Year Paid , earlier, except that the points paid were more than generally paid in your area (test (3)), you deduct in the year paid only the points that are generally charged. Turbotax 2012 You must spread any additional points over the life of the mortgage. Turbotax 2012 Mortgage ending early. Turbotax 2012   If you spread your deduction for points over the life of the mortgage, you can deduct any remaining balance in the year the mortgage ends. Turbotax 2012 However, if you refinance the mortgage with the same lender, you cannot deduct any remaining balance of spread points. Turbotax 2012 Instead, deduct the remaining balance over the term of the new loan. Turbotax 2012    A mortgage may end early due to a prepayment, refinancing, foreclosure, or similar event. Turbotax 2012 Example. Turbotax 2012 Dan paid $3,000 in points in 2002 that he had to spread out over the 15-year life of the mortgage. Turbotax 2012 He deducts $200 points per year. Turbotax 2012 Through 2012, Dan has deducted $2,200 of the points. Turbotax 2012 Dan prepaid his mortgage in full in 2013. Turbotax 2012 He can deduct the remaining $800 of points in 2013. Turbotax 2012 Limits on deduction. Turbotax 2012   You cannot fully deduct points paid on a mortgage unless the mortgage fits into one of the categories listed earlier under Fully deductible interest . Turbotax 2012 See Publication 936 for details. Turbotax 2012 Mortgage Insurance Premiums You can treat amounts you paid during 2013 for qualified mortgage insurance as home mortgage interest. Turbotax 2012 The insurance must be in connection with home acquisition debt and the insurance contract must have been issued after 2006. Turbotax 2012 Qualified mortgage insurance. Turbotax 2012   Qualified mortgage insurance is mortgage insurance provided by the Department of Veterans Affairs, the Federal Housing Administration, or the Rural Housing Service, and private mortgage insurance (as defined in section 2 of the Homeowners Protection Act of 1998 as in effect on December 20, 2006). Turbotax 2012   Mortgage insurance provided by the Department of Veterans Affairs is commonly known as a funding fee. Turbotax 2012 If provided by the Rural Housing Service, it is commonly known as a guarantee fee. Turbotax 2012 These fees can be deducted fully in 2013 if the mortgage insurance contract was issued in 2013. Turbotax 2012 Contact the mortgage insurance issuer to determine the deductible amount if it is not reported in box 4 of Form 1098. Turbotax 2012 Special rules for prepaid mortgage insurance. Turbotax 2012   Generally, if you paid premiums for qualified mortgage insurance that are allocable to periods after the close of the tax year, such premiums are treated as paid in the period to which they are allocated. Turbotax 2012 You must allocate the premiums over the shorter of the stated term of the mortgage or 84 months, beginning with the month the insurance was obtained. Turbotax 2012 No deduction is allowed for the unamortized balance if the mortgage is satisfied before its term. Turbotax 2012 This paragraph does not apply to qualified mortgage insurance provided by the Department of Veterans Affairs or the Rural Housing Service. Turbotax 2012 See the Example below. Turbotax 2012 Example. Turbotax 2012 Ryan purchased a home in May of 2012 and financed the home with a 15-year mortgage. Turbotax 2012 Ryan also prepaid all of the $9,240 in private mortgage insurance required at the time of closing in May. Turbotax 2012 Since the $9,240 in private mortgage insurance is allocable to periods after 2012, Ryan must allocate the $9,240 over the shorter of the life of the mortgage or 84 months. Turbotax 2012 Ryan's adjusted gross income (AGI) for 2012 is $76,000. Turbotax 2012 Ryan can deduct $880 ($9,240 ÷ 84 × 8 months) for qualified mortgage insurance premiums in 2012. Turbotax 2012 For 2013, Ryan can deduct $1,320 ($9,240 ÷ 84 × 12 months) if his AGI is $100,000 or less. Turbotax 2012 In this example, the mortgage insurance premiums are allocated over 84 months, which is shorter than the life of the mortgage of 15 years (180 months). Turbotax 2012 Limit on deduction. Turbotax 2012   If your adjusted gross income on Form 1040, line 38, is more than $100,000 ($50,000 if your filing status is married filing separately), the amount of your mortgage insurance premiums that are otherwise deductible is reduced and may be eliminated. Turbotax 2012 See Line 13 in the instructions for Schedule A (Form 1040) and complete the Mortgage Insurance Premiums Deduction Worksheet to figure the amount you can deduct. Turbotax 2012 If your adjusted gross income is more than $109,000 ($54,500 if married filing separately), you cannot deduct your mortgage insurance premiums. Turbotax 2012 Form 1098, Mortgage Interest Statement If you paid $600 or more of mortgage interest (including certain points and mortgage insurance premiums) during the year on any one mortgage, you generally will receive a Form 1098 or a similar statement from the mortgage holder. Turbotax 2012 You will receive the statement if you pay interest to a person (including a financial institution or a cooperative housing corporation) in the course of that person's trade or business. Turbotax 2012 A governmental unit is a person for purposes of furnishing the statement. Turbotax 2012 The statement for each year should be sent to you by January 31 of the following year. Turbotax 2012 A copy of this form will also be sent to the IRS. Turbotax 2012 The statement will show the total interest you paid during the year, any mortgage insurance premiums you paid, and if you purchased a main home during the year, it also will show the deductible points paid during the year, including seller-paid points. Turbotax 2012 However, it should not show any interest that was paid for you by a government agency. Turbotax 2012 As a general rule, Form 1098 will include only points that you can fully deduct in the year paid. Turbotax 2012 However, certain points not included on Form 1098 also may be deductible, either in the year paid or over the life of the loan. Turbotax 2012 See Points , earlier, to determine whether you can deduct points not shown on Form 1098. Turbotax 2012 Prepaid interest on Form 1098. Turbotax 2012   If you prepaid interest in 2013 that accrued in full by January 15, 2014, this prepaid interest may be included in box 1 of Form 1098. Turbotax 2012 However, you cannot deduct the prepaid amount for January 2014 in 2013. Turbotax 2012 (See Prepaid interest , earlier. Turbotax 2012 ) You will have to figure the interest that accrued for 2014 and subtract it from the amount in box 1. Turbotax 2012 You will include the interest for January 2014 with the other interest you pay for 2014. Turbotax 2012 See How To Report , later. Turbotax 2012 Refunded interest. Turbotax 2012   If you received a refund of mortgage interest you overpaid in an earlier year, you generally will receive a Form 1098 showing the refund in box 3. Turbotax 2012 See Refunds of interest , earlier. Turbotax 2012 Mortgage insurance premiums. Turbotax 2012   The amount of mortgage insurance premiums you paid during 2013 may be shown in box 4 of Form 1098. Turbotax 2012 See Mortgage Insurance Premiums, earlier. Turbotax 2012 Investment Interest This section discusses interest expenses you may be able to deduct as an investor. Turbotax 2012 If you borrow money to buy property you hold for investment, the interest you pay is investment interest. Turbotax 2012 You can deduct investment interest subject to the limit discussed later. Turbotax 2012 However, you cannot deduct interest you incurred to produce tax-exempt income. Turbotax 2012 Nor can you deduct interest expenses on straddles. Turbotax 2012 Investment interest does not include any qualified home mortgage interest or any interest taken into account in computing income or loss from a passive activity. Turbotax 2012 Investment Property Property held for investment includes property that produces interest, dividends, annuities, or royalties not derived in the ordinary course of a trade or business. Turbotax 2012 It also includes property that produces gain or loss (not derived in the ordinary course of a trade or business) from the sale or trade of property producing these types of income or held for investment (other than an interest in a passive activity). Turbotax 2012 Investment property also includes an interest in a trade or business activity in which you did not materially participate (other than a passive activity). Turbotax 2012 Partners, shareholders, and beneficiaries. Turbotax 2012   To determine your investment interest, combine your share of investment interest from a partnership, S corporation, estate, or trust with your other investment interest. Turbotax 2012 Allocation of Interest Expense If you borrow money for business or personal purposes as well as for investment, you must allocate the debt among those purposes. Turbotax 2012 Only the interest expense on the part of the debt used for investment purposes is treated as investment interest. Turbotax 2012 The allocation is not affected by the use of property that secures the debt. Turbotax 2012 Limit on Deduction Generally, your deduction for investment interest expense is limited to the amount of your net investment income. Turbotax 2012 You can carry over the amount of investment interest that you could not deduct because of this limit to the next tax year. Turbotax 2012 The interest carried over is treated as investment interest paid or accrued in that next year. Turbotax 2012 You can carry over disallowed investment interest to the next tax year even if it is more than your taxable income in the year the interest was paid or accrued. Turbotax 2012 Net Investment Income Determine the amount of your net investment income by subtracting your investment expenses (other than interest expense) from your investment income. Turbotax 2012 Investment income. Turbotax 2012    This generally includes your gross income from property held for investment (such as interest, dividends, annuities, and royalties). Turbotax 2012 Investment income does not include Alaska Permanent Fund dividends. Turbotax 2012 It also does not include qualified dividends or net capital gain unless you choose to include them. Turbotax 2012 Choosing to include qualified dividends. Turbotax 2012   Investment income generally does not include qualified dividends, discussed in chapter 8. Turbotax 2012 However, you can choose to include all or part of your qualified dividends in investment income. Turbotax 2012   You make this choice by completing Form 4952, line 4g, according to its instructions. Turbotax 2012   If you choose to include any amount of your qualified dividends in investment income, you must reduce your qualified dividends that are eligible for the lower capital gains tax rates by the same amount. Turbotax 2012 Choosing to include net capital gain. Turbotax 2012   Investment income generally does not include net capital gain from disposing of investment property (including capital gain distributions from mutual funds). Turbotax 2012 However, you can choose to include all or part of your net capital gain in investment income. Turbotax 2012    You make this choice by completing Form 4952, line 4g, according to its instructions. Turbotax 2012   If you choose to include any amount of your net capital gain in investment income, you must reduce your net capital gain that is eligible for the lower capital gains tax rates by the same amount. Turbotax 2012    Before making either choice, consider the overall effect on your tax liability. Turbotax 2012 Compare your tax if you make one or both of these choices with your tax if you do not. Turbotax 2012 Investment income of child reported on parent's return. Turbotax 2012    Investment income includes the part of your child's interest and dividend income that you choose to report on your return. Turbotax 2012 If the child does not have qualified dividends, Alaska Permanent Fund dividends, or capital gain distributions, this is the amount on line 6 of Form 8814, Parents' Election To Report Child's Interest and Dividends. Turbotax 2012 Child's qualified dividends. Turbotax 2012   If part of the amount you report is your child's qualified dividends, that part (which is reported on Form 1040, line 9b) generally does not count as investment income. Turbotax 2012 However, you can choose to include all or part of it in investment income, as explained under Choosing to include qualified dividends , earlier. Turbotax 2012   Your investment income also includes the amount on Form 8814, line 12 (or, if applicable, the reduced amount figured next under Child's Alaska Permanent Fund dividends). Turbotax 2012 Child's Alaska Permanent Fund dividends. Turbotax 2012   If part of the amount you report is your child's Alaska Permanent Fund dividends, that part does not count as investment income. Turbotax 2012 To figure the amount of your child's income that you can consider your investment income, start with the amount on Form 8814, line 6. Turbotax 2012 Multiply that amount by a percentage that is equal to the Alaska Permanent Fund dividends divided by the total amount on Form 8814, line 4. Turbotax 2012 Subtract the result from the amount on Form 8814, line 12. Turbotax 2012 Child's capital gain distributions. Turbotax 2012    If part of the amount you report is your child's capital gain distributions, that part (which is reported on Schedule D, line 13, or Form 1040, line 13) generally does not count as investment income. Turbotax 2012 However, you can choose to include all or part of it in investment income, as explained in Choosing to include net capital gain , earlier. Turbotax 2012   Your investment income also includes the amount on Form 8814, line 12 (or, if applicable, the reduced amount figured under Child's Alaska Permanent Fund dividends , earlier). Turbotax 2012 Investment expenses. Turbotax 2012   Investment expenses are your allowed deductions (other than interest expense) directly connected with the production of investment income. Turbotax 2012 Investment expenses that are included as a miscellaneous itemized deduction on Schedule A (Form 1040) are allowable deductions after applying the 2% limit that applies to miscellaneous itemized deductions. Turbotax 2012 Use the smaller of: The investment expenses included on Schedule A (Form 1040), line 23, or The amount on Schedule A, line 27. Turbotax 2012 Losses from passive activities. Turbotax 2012   Income or expenses that you used in computing income or loss from a passive activity are not included in determining your investment income or investment expenses (including investment interest expense). Turbotax 2012 See Publication 925, Passive Activity and At-Risk Rules, for information about passive activities. Turbotax 2012 Form 4952 Use Form 4952, Investment Interest Expense Deduction, to figure your deduction for investment interest. Turbotax 2012 Exception to use of Form 4952. Turbotax 2012   You do not have to complete Form 4952 or attach it to your return if you meet all of the following tests. Turbotax 2012 Your investment interest expense is not more than your investment income from interest and ordinary dividends minus any qualified dividends. Turbotax 2012 You do not have any other deductible investment expenses. Turbotax 2012 You have no carryover of investment interest expense from 2012. Turbotax 2012 If you meet all of these tests, you can deduct all of your investment interest. Turbotax 2012 More Information For more information on investment interest, see Interest Expenses in chapter 3 of Publication 550. Turbotax 2012 Items You Cannot Deduct Some interest payments are not deductible. Turbotax 2012 Certain expenses similar to interest also are not deductible. Turbotax 2012 Nondeductible expenses include the following items. Turbotax 2012 Personal interest (discussed later). Turbotax 2012 Service charges (however, see Other Expenses (Line 23) in chapter 28). Turbotax 2012 Annual fees for credit cards. Turbotax 2012 Loan fees. Turbotax 2012 Credit investigation fees. Turbotax 2012 Interest to purchase or carry tax-exempt securities. Turbotax 2012 Penalties. Turbotax 2012   You cannot deduct fines and penalties paid to a government for violations of law, regardless of their nature. Turbotax 2012 Personal Interest Personal interest is not deductible. Turbotax 2012 Personal interest is any interest that is not home mortgage interest, investment interest, business interest, or other deductible interest. Turbotax 2012 It includes the following items. Turbotax 2012 Interest on car loans (unless you use the car for business). Turbotax 2012 Interest on federal, state, or local income tax. Turbotax 2012 Finance charges on credit cards, retail installment contracts, and revolving charge accounts incurred for personal expenses. Turbotax 2012 Late payment charges by a public utility. Turbotax 2012 You may be able to deduct interest you pay on a qualified student loan. Turbotax 2012 For details, see Publication 970, Tax Benefits for Education. Turbotax 2012 Allocation of Interest If you use the proceeds of a loan for more than one purpose (for example, personal and business), you must allocate the interest on the loan to each use. Turbotax 2012 However, you do not have to allocate home mortgage interest if it is fully deductible, regardless of how the funds are used. Turbotax 2012 You allocate interest (other than fully deductible home mortgage interest) on a loan in the same way as the loan itself is allocated. Turbotax 2012 You do this by tracing disbursements of the debt proceeds to specific uses. Turbotax 2012 For details on how to do this, see chapter 4 of Publication 535. Turbotax 2012 How To Report You must file Form 1040 to deduct any home mortgage interest expense on your tax return. Turbotax 2012 Where you deduct your interest expense generally depends on how you use the loan proceeds. Turbotax 2012 See Table 23-1 for a summary of where to deduct your interest expense. Turbotax 2012 Home mortgage interest and points. Turbotax 2012   Deduct the home mortgage interest and points reported to you on Form 1098 on Schedule A (Form 1040), line 10. Turbotax 2012 If you paid more deductible interest to the financial institution than the amount shown on Form 1098, show the larger deductible amount on line 10. Turbotax 2012 Attach a statement explaining the difference and print “See attached” next to line 10. Turbotax 2012    Deduct home mortgage interest that was not reported to you on Form 1098 on Schedule A (Form 1040), line 11. Turbotax 2012 If you paid home mortgage interest to the person from whom you bought your home, show that person's name, address, and taxpayer identification number (TIN) on the dotted lines next to line 11. Turbotax 2012 The seller must give you this number and you must give the seller your TIN. Turbotax 2012 A Form W-9, Request for Taxpayer Identification Number and Certification, can be used for this purpose. Turbotax 2012 Failure to meet any of these requirements may result in a $50 penalty for each failure. Turbotax 2012 The TIN can be either a social security number, an individual taxpayer identification number (issued by the Internal Revenue Service), or an employer identification number. Turbotax 2012 See Social Security Number (SSN) in chapter 1 for more information about TINs. Turbotax 2012    If you can take a deduction for points that were not reported to you on Form 1098, deduct those points on Schedule A (Form 1040), line 12. Turbotax 2012   Deduct mortgage insurance premiums on Schedule A (Form 1040), line 13. Turbotax 2012 More than one borrower. Turbotax 2012   If you and at least one other person (other than your spouse if you file a joint return) were liable for and paid interest on a mortgage that was for your home, and the other person received a Form 1098 showing the interest that was paid during the year, attach a statement to your return explaining this. Turbotax 2012 Show how much of the interest each of you paid, and give the name and address of the person who received the form. Turbotax 2012 Deduct your share of the interest on Schedule A (Form 1040), line 11, and print “See attached” next to the line. Turbotax 2012 Also, deduct your share of any qualified mortgage insurance premiums on Schedule A (Form 1040), line 13. Turbotax 2012   Similarly, if you are the payer of record on a mortgage on which there are other borrowers entitled to a deduction for the interest shown on the Form 1098 you received, deduct only your share of the interest on Schedule A (Form 1040), line 10. Turbotax 2012 You should let each of the other borrowers know what his or her share is. Turbotax 2012 Mortgage proceeds used for business or investment. Turbotax 2012    If your home mortgage interest deduction is limited, but all or part of the mortgage proceeds were used for business, investment, or other deductible activities, see Table 23-1. Turbotax 2012 It shows where to deduct the part of your excess interest that is for those activities. Turbotax 2012 Investment interest. Turbotax 2012    Deduct investment interest, subject to certain limits discussed in Publication 550, on Schedule A (Form 1040), line 14. Turbotax 2012 Amortization of bond premium. Turbotax 2012   There are various ways to treat the premium you pay to buy taxable bonds. Turbotax 2012 See Bond Premium Amortization in Publication 550. Turbotax 2012 Income-producing rental or royalty interest. Turbotax 2012   Deduct interest on a loan for income-producing rental or royalty property that is not used in your business in Part I of Schedule E (Form 1040). Turbotax 2012 Example. Turbotax 2012 You rent out part of your home and borrow money to make repairs. Turbotax 2012 You can deduct only the interest payment for the rented part in Part I of Schedule E (Form 1040). Turbotax 2012 Deduct the rest of the interest payment on Schedule A (Form 1040) if it is deductible home mortgage interest. Turbotax 2012 Table 23-1. Turbotax 2012 Where To Deduct Your Interest Expense IF you have . Turbotax 2012 . Turbotax 2012 . Turbotax 2012 THEN deduct it on . Turbotax 2012 . Turbotax 2012 . Turbotax 2012 AND for more information go to . Turbotax 2012 . Turbotax 2012 . Turbotax 2012 deductible student loan interest Form 1040, line 33, or Form 1040A, line 18 Publication 970. Turbotax 2012 deductible home mortgage interest and points reported on Form 1098 Schedule A (Form 1040), line 10 Publication 936. Turbotax 2012 deductible home mortgage interest not reported on Form 1098 Schedule A (Form 1040), line 11 Publication 936. Turbotax 2012 deductible points not reported on Form 1098 Schedule A (Form 1040), line 12 Publication 936. Turbotax 2012 deductible mortgage insurance premiums Schedule A (Form 1040), line 13 Publication 936. Turbotax 2012 deductible investment interest (other than incurred to produce rents or royalties) Schedule A (Form 1040), line 14 Publication 550. Turbotax 2012 deductible business interest (non-farm) Schedule C or C-EZ (Form 1040) Publication 535. Turbotax 2012 deductible farm business interest Schedule F (Form 1040) Publications 225 and 535. Turbotax 2012 deductible interest incurred to produce rents or royalties Schedule E (Form 1040) Publications 527 and 535. Turbotax 2012 personal interest not deductible. Turbotax 2012 Prev  Up  Next   Home   More Online Publications