My son closed on a house on 06/01/06. An adjustment of $989 was shown on the closing statement for items unpaid by seller for real estate taxes from 01/01/06 thru 05/31/06. The 1098 form he received from his mortgage company showed $2566 taxes paid.
What is the amount he can claim as his deduction?
2007-01-30 23:52:47 · 3 answers · asked by Gary G 1 in Business & Finance ➔ Taxes ➔ United States
All of it. I bet you like that answer, yes? Sure, those were the taxes that he paid whether he paid directly or indirectly out of his loan, closing costs or up front. Yay!
And ninasgram? Why do you think that renters can deduct part of their rent paid to a landlord? hmmm...it's because they consider part of that is property taxes! How bout that. Somebody can deduct taxes on property that they don't own? Amazing. Sorry, but your answer doesn't work.
2007-01-31 01:02:12 · answer #1 · answered by Barbara 5 · 0⤊ 1⤋
Both wrong! The $2,566 on the 1098 shows the taxes for the entire year without regard to who owned the property. He must reduce the tax for the year of purchase by the amount that was attributable to the seller -- $989.00 in this case. His net deduction is therefore $1,577.00
2007-01-31 01:23:30 · answer #2 · answered by Bostonian In MO 7 · 0⤊ 0⤋
He can deduct the taxes he paid for the time he owned the house. That would be $2,566. The payment at closing refers to taxes that were for a period of time when he did not own the house. He cannot deduct taxes on property he didn't own at the time taxes were due.
2007-01-31 00:54:28 · answer #3 · answered by ninasgramma 7 · 0⤊ 2⤋