Dan Feix wrote:

- quote -

Yes (agreeing with the other answers).

However, if there was a PROPERTY TAX IMPOUND ACCOUNT or one
for insurance, there could be interest earned on those
deposits (before they get paid out on their due dates - once
or twice a year) which could be a different type of
deduction: Forfeiture of interest earned which goes on line
31 of the front of form 1040 (normally used for the
forfeiture of interest on premature withdrawl from savings
accounts and CDs).

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

danf[at]gvii.net (Dan Feix) wrote:

- quote -

Yes, it is.

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

Dan Feix wrote:

- quote -

Yes.

ChEAr$,
Harlan Lunsford, EA n LA

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

Dan Feix wrote:

- quote -

Per Revenue Ruling 73-137, such a payment is considered
interest. As such, assuming the other requirements for the
amount to be considered deductible home mortgage interest
are met (security, maximum amount of debt, etc.), it would
be deductible.

--
Ed Zollars, CPA
Phoenix, Arizona

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

"Dan Feix" <danf[at]gvii.net> wrote:

- quote -

Look at the original mortgage to be sure, but probably yes.

--
David M. Woods, EA, ChFC, CLU
Woods Financial Services
Norwood, MA 02062
www.woods-financial.com

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

danf[at]gvii.net (Dan Feix) writes:

- quote -

Yes. See IRS Publication 936.

Phil Marti
Topeka, KS

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

"Dan Feix" <danf[at]gvii.net> wrote

- quote -

It probably is. The mortgage company should report it as
such on the 1098 they should send at the end of the year.

--
Paul A. Thomas, CPA
Athens, Georgia
taxman at negia.net

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

- quote -

YES!!! . He/she can deduct that penalty as home mortgage
interest provided the penalty is not for a specific service
performed or cost incurred in connection with his/her
mortgage loan.

"Jack" - John H. Fisher - TaxService[at]aol.com
Philadelphia, Pa - Atlantic City, NJ - West Wildwood, NJ
My Newsgroups & Boards at: http://members.aol.com/TaxService/index.html

Where Ignorance is bliss, 'tis folly to be wise!=

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

Dan Feix wrote:

- quote -

Yes.

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

I have a friend who sold his house and had to pay a prepayment penalty
of about $7,000. Is this deductible mortgage interest?

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->