Wednesday, September 9, 2009

Mortgage Interest Crackdown

As reported in The Kiplinger Tax Letter this week, the IRS is using additional tools to catch tax cheats. Revenue is going nationwide using Form 1098 (mortgage interest) to find nonfilers. Large interest payments without a filed return will likely cause an audit. Also, having a mortgage interest expense higher than your reported income may bring the taxman to your door.

As a reminder: There is a $100,000 cap on home equity loans. The IRS wants banks to separate this out on Form 1098 for easier enforcement. Home equity loans used for investment or business may be deductible separately.


Kiplinger is a great resource and investment.

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