Ron
EH get aliitle harsh sometimes, to put it mildly.
With the loan amount, interest rate, 1st payment date, and a financial calulator, You can figure exactly how much is principal and how much is interest.
Ron,
This is not as complicated as you think.
When you own the property, and you make the payments, which include the interest, the tax benefits of this are yours…regardless of who’s name is on the loan.
So, when the 1098 comes in the mail, with the original barrowers name on it, use that to file your taxes.
When you do file, in the section where this interest is documented, there will be a form/question asking if the lender sent you a form with this info on it.
You simply check the box that says, “no”, and then complete the next part, where the form askes you to place the information that did come on the 1098.
The IRS does not care who’s name is on the form, just who paid the money out.
You paid the interest on YOUR property. The loan being in the former owner’s name is irrelevant, providing both of you don’t try to claim the same deduction.
Posted by Equity Hunter on March 11, 2006 at 22:09:59:
You don’t have a form. You have your cancelled checks assuming you ever get audited in the first place. Get with the previous owner to get the exact amt if that is possible. Or most lenders have a web site from which you might be able to get the exact figure. If you are an accountant, you shouldn’t be in this business.