I refinanced my home on January 1 and paid $1,230 in points. On Schedule A, line 12 (points not reported on Form 1098) I have listed $41 each year. I refinanced my home again with a different lender and paid off the entire previous loan. Am I entitled to include the $984 (remaining points not yet paid off) on Schedule A this year?
If you spread your deduction of the points over the life of the mortgage, you can deduct any remaining balance of the points in the year the mortgage ends. A mortgage may end early due to a prepayment, refinancing, foreclosure, or similar event. If you refinanced with the same lender you cannot deduct any remaining balance of points. Instead, spread them over the life of the new mortgage.
Under the conditions described in the question, the $984 would be deductible in the year the mortgage ended. You would report the deduction on Form 1040, Schedule A (PDF), Itemized Deductions. For more information, refer to Publication 936, Home Mortgage Interest Deduction; and Tax Topic 504, Home Mortgage Points.
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