How do you claim your deductable interest paid on the Mortgage?

Question

I bought this house last year. I filed 2007 tax but there was no option where I could claim the deductable interest. Do they know it automatically or do we need to notify them. I am worried may be I'm losing whole lot of money.

Answer 1

Form 1040 Schedule A (Itemized Deductions)

If you filed a 1040A or a 1040EZ there is not an option for deducting interest. You need to file the long form.

Take your return to a professional and see if he or she can find you some more money!

Answer 2

Mortgage interest and property taxes are on a separate, Schedule A. If you did not report your mortgage interest and property tax deduction, you should file an amended return. It is best to go to a tax adviser and pay a couple hundred bucks to get this right. Then next year you will know where the amounts go. Since you are able to deduct mortgage interest and property tax, you should also add in charitable contributions, vehicle registration fees, and state income tax that you may have paid. This can add up to a lot of money you're getting back.

Answer 3

You will get a mortgage interest form from your mortgage company. You have to be able to itemize your deductions in order to claim your interest. That means that your interest and any other eligible deductions have to add up to more than your standard deduction. If you purchased your house well into 2006, you might not have had enough interest. The tax schedule for itemizing your deduction is Schedule A.

Answer 4

If your total itemized deductions add up to more than your standard deduction, then you show them on Schedule A, and take that total rather than the standard deduction. If the total of your allowable itemized deductions is less than the standard deduction, then you don't show them and you get no tax benefit from them.

Standard deduction for 2006, the tax year you filed for in 2007, was $5150 if you're single, $10,300 if you're married filing a joint return.

Answer 5

I bought a house 1 year ago and have done my 2006 taxes with some mortgage interest. I tried to do the taxes on paper and found it quite complicated vs. using TurboTax Deluxe which I purchased at Costco for $35 ($45 at retail stores). TurboTax Deluxe asks for simple inputs and puts the right numbers on the right lines of the required forms it determines applicable based on your inputs and prints it out on the correct forms for mailing or electronic filing.

If you know someone else in the same position you can share the same software bundle and costs.

Answer 6

It's an itemized deduction on schedule A of your 1040.

Answer 7

You need to file a long form to report the interest. There is no way that they know automatically what you paid.