I'm really in need of additional deductions this year. Can I have 13 payments in one year?
2007-10-02 12:26:35 · 12 answers · asked by John L 5 in Business & Finance ➔ Taxes ➔ United States
See page 14 at this link on prepaid interest. OK to take the January payment in 2007 but not February.
http://www.irs.gov/pub/irs-pdf/p936.pdf
2007-10-03 08:20:20 · answer #1 · answered by spicertax 5 · 0⤊ 1⤋
Mortgage interest that is due January 1 is for the month of December. So paying the interest in December is fine. You can deduct it in 07.
You couldn't deduct the interest due Feb 1 08 in 2007 by paying in December 07, as this interest is for the month of January 08.
The 1098 you receive from your mortgage company or bank will show all interest paid in 2007, including the early payment you made in December.
2007-10-02 14:58:13 · answer #2 · answered by ninasgramma 7 · 0⤊ 1⤋
Sure you can make the payment for Jan 08 in Dec 07 but you can't claim it on 07 taxes.
2007-10-02 16:52:19 · answer #3 · answered by Anonymous · 0⤊ 1⤋
What??? Some of these answers are dangerous.
You certainly can make the payment early. As an individual, unless you for some uncommon reason elected the accrual method, you are cash basis taxpayer. This means - you report income when received (or constructively received) and deductions when paid.
Thus, pay interest-get a deduction when PAID!
2007-10-02 14:09:10 · answer #4 · answered by asktheknowitall 2 · 1⤊ 0⤋
Yes Yes Yes!!!!!!!! The irs wants to know how much interest you paid in 2007. As long as you paid it in 2007, it is ONLY deductible in 2007. They don't even see whether all the payments are made over 12 months, 6 months or whatever.
2007-10-02 14:32:44 · answer #5 · answered by YoungGirl 2 · 1⤊ 0⤋
Yes you can. You will need to provide a statement to the IRS when filing your tax return why the interest on your 1098 does not match the interest being claimed on your tax return.
You will need to modify your 2008 taxes as well showing that you only made 11 interest payments instead of 12.
2007-10-02 14:00:20 · answer #6 · answered by Steve 6 · 0⤊ 2⤋
For Federal income taxes, interest is deductible in the year paid. When it is DUE does not matter. May tax advises recommend this method to 'lump' deductions into on year. This is particularly helpful if your itemized deductions are close to the standard deduction. You lump as many deductions as possible into alternate years and claim the standard deduction in the remaining years.
2007-10-02 14:45:22 · answer #7 · answered by STEVEN F 7 · 1⤊ 1⤋
Most certainly you can have 13 payments in one year, you could even have 14 or 15 or 16, etc, payments in one year. You can have as many payments as you can afford to make
2007-10-02 14:26:09 · answer #8 · answered by Anonymous · 1⤊ 1⤋
Yes. This is perfectly legal. Send it in a few days prior to the end of the year and make sure it's dated early as well.
2007-10-02 13:58:53 · answer #9 · answered by Bostonian In MO 7 · 1⤊ 0⤋
Probably can. But keep in mind, you're going to be one payment short on interest in 2008.
2007-10-02 12:32:51 · answer #10 · answered by Angie 6 · 0⤊ 1⤋