Question

Deductions for mortgage points paid by buyer's real estate agent?

Forum|Forum|4 years ago
April 10, 2022
1 reply
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I've purchased a primary residence in California in 2021.

My real estate agent (i.e. the buyer's agent) gave me a closing cost credit.

This credit was used to buy points on my mortgage.

Form 1098 from the mortgage lender shows $0 amount in Box 6 ("Points paid on purchase of principal residence") and the Closing Disclosure shows Points as being "Paid by Others" with a dollar amount.

Am I allowed to claim deductions for points paid by the buyer's agent?

Since IRS explicitly allows deductions for seller paid points, it also seems reasonable to think the same goes for buyer's agent paid points.

Thanks in advance.

M

Mike9241

since your agent paid them, you get no deduction. in effect, your mortgage or the cash you had to come up with to close was lower.

J

jb314Author

Thanks for the reply.

Could you explain why a seller paying for the points would qualify for deductions while my agent paying for it wouldn't? These two situations seem very close. Your explanation that the mortgage that I had to come up with to close being lower applies equally to the situation of the seller paying for the points.

P

PattiF

You did not pay for the points and the deduction is only for the person who paid. Your agent can deduct the points on their own return as a business expense.

@jb314

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