If a taxpayer received Form 1098 reporting mortgage interest, where it is reported in the tax return depends on what the interest is related to.
If it's related to their business, report it as a business expense on Schedule C if it's a sole proprietorship, Schedule F if it's a farm, or if rental property with the property's expenses reported on Schedule E.
Otherwise, the mortgage interest is deductible on Schedule A but only to the extent that the loan proceeds from the home mortgage were used to buy, build, or substantially improve the home securing the loan. For the purposes of Schedule A, a house, a boat, a condo, a cooperative, a mobile home, or other structures qualifies as a home, and the mortgage loan can be a first or second loan, a refinanced loan, or a home equity loan.
If points are reported on Form 1098 in Box 6, they are generally deductible. However, in some cases they may not be deductible at all or in full, e.g., the taxpayer is filing MFS, or the mortgage is for multiple properties. See the information on points in Publication 936 if you're uncertain about their deductibility.
Mortgage interest and points not reported on Form 1098, e.g., due to their total being under $600, can also be deducted.
To enter interest as an itemized deduction on Schedule A in TaxSlayer ProWeb, from the Federal Section of the Tax Return (Form 1040) select:
- Itemized Deductions
- Mortgage Interest and Expenses
Note: This is a brief guide on entering mortgage interest into TaxSlayer ProWeb. This is not intended as tax advice.
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