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Lev
Lev, Tax Advisor
Category: Tax
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Experience:  Taxes, Immigration, Labor Relations
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Is the amount an individual paid to the loan company to secure

Resolved Question:

Is the amount an individual paid to the loan company to secure a reverse mortgage tax deductible?
Submitted: 1 year ago.
Category: Tax
Expert:  Lev replied 1 year ago.

LEV :

Hi and welcome to Just Answer!
The cost to obtain a mortgage is deducted as a mortgage interest over the life of that mortgage.
That cost generally may not be deducted in the year paid.
Thus - if that is a 30-year mortgage - the cost is deducted ratably over 30 years.

LEV :

The IRS has developed a new form for employees who have been misclassified as independent contractors by an employer. Form 8919, Uncollected Social Security and Medicare Tax on Wages, will now be used to figure and report the employee’s share of uncollected social security and Medicare taxes due on their compensation.
By filing this form - you will pay ONLY your portion of FICA taxes as an employee. And your employer will be responsible to pay their portion.

LEV :

Sorry - the last post was a mistake. Please disregard.
Let me know if you need any help or clarification.

Customer:

Just to be clear, even on a reverse mortgage where the taxpayer had to pay 40k upfront deposit for the loan, he can only amortize the coast over the life of the loan?

LEV :

That is correct - the deposit which is not repaid back - is treated as a prepaid mortgage interest and may be deducted over the life of the mortgage.
The part of the deposit which is expected to paid back is not deductible.

Customer:

great appreciate the help

Lev, Tax Advisor
Category: Tax
Satisfied Customers: 22359
Experience: Taxes, Immigration, Labor Relations
Lev and 6 other Tax Specialists are ready to help you

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