2017 Refinance paid VA funding fee question

[nwtaxlady]

New client had done own 2017 tax return. I see that they refinance in 2017 to pay off debt. In the refinance, they paid a VA Funding Fee of $6667. This is Mortgage Insurance Premiums prepaid. Normally, with a purchase you can deduct the "VA Funding Fee" all at once. My question is, this is a refinance and they did not bring cash INTO the refinance so can we amend and take it all? I am questioning it, because they did not bring CASH INTO the refinance.

[nwtaxlady]

Anyone have some input on this? Amend and take it all since it was a "VA Funding Fee"? Or since it was a refinance to take equity out and no cash brought into the transaction, then amortize it over 7 years?

[Anarchrist]

Is it listed on the 1098 as mortgage insurance?

Is this acquisition debt?

[nwtaxlady]

Is it listed on the 1098 as mortgage insurance?

Is this acquisition debt?

yes, it is Mortgage Insurance and he refinanced his acquisition debt loan and took out equity to pay off debts. So after the refinance it is a combination of Acquisition debt and equity debt.