1098 vs HUD difference in org fees.

[AZ-Tax]

Box 2 of form 1098 is $749 but HUD ln 803 adj org charges is $1499. I was thinking of fully deducting $749 and amortizing the $1499 for the life of the loan. Your thoughts.

[Gary2]

There should be a break down of the origination charges, and the points will probably show up there. So it's unlikely you can treat the $749 as being in addition to the $1499.

But how do you come by both points and amortization? The points would only be fully deductible on the purchase of a home, so that the other origination charges would be part of the basis, not an amortizable deduction. If it's a duplex or similar part rental or part business use, then I think you'd have to pro-rate the points, with only the residence part being fully deductible in the current year.

[AZ-Tax]

Its a residential house

and no breakdown of the org fees but Gary probably correct that the $749 if part of the other $1499

[Burke]

I have seen this before where half is listed as "loan origination fee" on 801 and half is listed as "loan discount %" on 802. Line 803 is appraisal fees (at least on the HUD-1 I am looking at.)
Bottom line is, if the $1,499 is a percentage of the loan issued to the borrower as a mtge, then it is treated as points or prepaid interest and normal full deduction/amortization rules apply.
It is not likely that the $749 on the 1098 is in addition to the $1,499. It could be that 1/2 was paid to the bank issuing the 1098, and the other half was paid to another bank (or interim mtge company).

[S T]

HUD Statement

Using the HUD Closing Statement and comparing to the 1098 form at the end of the year (if there was a purchase-or refinance) will assist you.

TTB 6-2 has a sample of the Settlement costs for Real Estate with line reference to HUD-1 Stmt. you will see that line 801-803 on the HUD statement are referenced for the Loan origination fee as Burke outlined and Gary referenced.

You did not specify whether it was a residental personal residence purchase, a rental purchase or a refinance. So there would be a question whether the amounts are deductible or need to be amortized

Sandy

[FEDUKE404]

Possibility

Is this perhaps a VA/FHA loan?

Due to the inherent nature of the charges/discounts/etc I have seen some "contradictory" numbers that defied logic until someone with the complete facts was able to explain them to me.

Maybe someone on these boards is not only a tax person but also a Realtor?

FE

[Burke]

An explanation can be obtained in regard to this matter by talking to the closing agent listed at the top of the HUD-1 form, whether it is a title company, attorney or other entity. You would be surprised at the errors we find on these forms. There was probably a mortgage broker involved and they split the fees. Don't be surprised if another 1098 shows up; but also don't count on it.