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Strategies & Market Trends : Income Taxes and Record Keeping ( tax ) -- Ignore unavailable to you. Want to Upgrade?

To: Zeuspaul who wrote (186)	11/5/1997 10:21:00 AM
From: Colin Cody	Respond to of 5810

>Or do they see this issue differently than you? . Hold on! Let's remember I MERELY AGREEDED with YOU! You asked if your Mortgage Broker was correct, and I AGREED. . Now looking at the pompous lawyers who wrote up that URL site you mentioned are way out of their class and "NO" I would not take what they say as a substitute for the LAW. . On example from their prose: The say GENERALLY points are fully deductible: . Points on purchase are generally fully deductible. Points on refinance are amortized over the life of the loan. If you refinance again, the previously unamortized points for the old loan become fully deductible. . BUT then in the SAME paragraph they say BUT old re-fi POINTS are ALWAYS deductible. You can't have it BOITH WAYS! . I'd use these lawyers as a fine general read for a basic generalized overview and for "entertainment purposes only". . Old Unamortized Points on REFINANCES to be deductible AT THAT TIME among other things NEED TO BE PAID. . Example: You have a mortgage at Chase Manhattan for $100,000 on which you are amortizing old points paid. You re-finance with them for a slightly lower interest rate BUT they extract two additional points and they add that to the loan for a new balance of $102,000. RESULT you used to be paying $955 a month, and after re-fi you will pay only $945. . You are ahead by $10 a month, But you continue to amortize your old points and the new points. You get no immediate write-off. . THIS IS SUBJECT TO OTHER INTERPRETATIONS. You can ask your mortgage broker about it, since he is the one who told you about the need to PAY OFF the old points. The most controvertial interpretations deal with the definition of just what "paying off" the old points means. . For THAT gray area you need to make your OWN decision with your own tax advisor! . Colin