Many homeowners have taken advantage of stimulus programs and low interest rates and got a mortgage refinancing. Many homeowners are preparing to do their taxes and are looking for all their deductions and trying to be able to save as much as possible. On top of other things, many of the costs associated with mortgage refinancing are actually tax deductible. Here are some tips for homeowners looking for mortgage refinancing tax deductions.

Many homeowners paid for points on their current home loan. These points are tax deductible throughout the entire length of the mortgage repayment period. Many homeowners are able to get a tax deduction on any interest payment points in the past 12 months. This can easily add up to thousands of dollars and is one of the most common, and beneficial, tax write offs. Homeowners who refinanced a home mortgage and paid it off earlier than expected can write off the remaining points on their home loan for the whole year on their taxes.

Some homeowners got a cash back mortgage refinancing using the equity they built up in their home. Many of those people used the money on home repairs and improvements. Those homeowners are able to get a tax deduction for an entire 12 months worth of home loan interest payments by meeting basic IRS requirements. One of the main requirements is having proof of the home repair or improvement with invoices and receipts to back it all up.

There are always going to be different requirements and restrictions on different home mortgage refinancing related tax deductions that are situation specific. However, for the most part, homeowners are able to write off, mortgage loan interest points, closing costs and related fees, and sometimes, the interest on a years worth of mortgage payments on a cash back refinancing. Some fees are not tax deductible such as lawyer fees, paperwork costs, and private mortgage insurance to name a few. Most of the time though, many different tax deductions are available to a homeowner who has gotten a mortgage refinancing in the past 12 months. Homeowners can always go to a tax preparation service if they have any doubts or questions, which is sometimes the best thing to do. For a small fee, a homeowner can ensure they get all their deductions, and mistakes are much less likely to be made.

Thousands of homeowners have taken advantage of stimulus plans and low interest rates and gotten a mortgage refinancing in the past year. Homeowners who take their time and carefully look through everything can easily find many mortgage related expenses and costs that they will be able to write off. Some of those deductions may be small, but they add up if enough of them are found. Homeowners who do not take action and take advantage of tax write offs available to them will not have another chance to get them until they buy another home or get another mortgage refinancing. Homeowners should do a little paperwork and ensure they get all available tax deductions that are available to them.

-M Petrone

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