I refinanced my home loan in 2021 and used the funds then. Do I have to claim them again now for 2024?

Forum|Forum|1 year ago
February 11, 2025
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Turbo Tax is asking me about my refinanced loan. I did this back in 2021. It's asking me how much of this loan I used on home improvements - that was 4 years ago, I have no idea.

MonikaK1

TurboTax will ask the question "Did you use the loan for anything besides paying off the existing loan?" when you identify that a loan was a refinance of a previous loan. The current law doesn't allow you to deduct amounts as interest on a principal residence that were not incurred to buy or improve the property.

Check your loan records or your prior year returns to determine how much of the loan proceeds were used other than to pay off the prior loan.

Any secured debt you use to refinance home acquisition debt is treated as home acquisition debt. However, the new debt will qualify as home acquisition debt only up to the amount of the balance of the old mortgage principal just before the refinancing. Any additional debt not used to buy, build, or substantially improve a qualified home isn't home acquisition debt.

See this TurboTax tips article and this help article for more information.

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