Taxpayers MFJ bought a home in Mississippi to move into most likely in 2025. Bought home in 2023. They currently live in a home they own in Kentucky which will be sold when they retire and move to Mississippi. There were a lot of points paid on the new home they bought in 2023 but because it's not their main home I could not include all and the points had to be amortized. Taxpayer asked when they move and the new home becomes their main home can they at that point claim all of the remaining points on schedule A that year? I've never had this happen so reaching out for input. Thank you for any help
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No. General rule is that points must be amortized. There is an exception that allows points to be deducted in the year paid. But in your case, the taxpayer did not meet the exception for deducting in the year paid. See Pub 936.
Although you didn't ask, also be sure to distinguish between points (which are interest charges) and other closing costs, which are not deductible as mortgage interest."You said it, they'll never know the difference. Come on, we'll paint our way out!" - Moe Howard
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