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andrewg111
March 27, 2022
Question

Rental property refinancing?

  • March 27, 2022
  • 1 reply
  • 0 views

I refinanced my rental property in Jan 2021. I’m having a hard time understanding how to annotate that transaction in TurboTax. Do I delete the old loan that was being depreciated since 2013? Add the new? Also with the refinance the land is worth more than what I borrowed? I searched all over the place but I can’t figure out how to proceed. Any help is greatly appreciated 

    1 reply

    LeonardS
    LeonardS
    March 27, 2022

    No, you do not delete the old loan. You will continue to deduct the new loan interest as you have been doing with the original loan.  Depreciation is based on the basis of the property and is not affected when you refinance.  You will account for any increase in the value of the land and property when you sell the rental property. 

     

    You can deduct all costs associated with obtaining a new mortgage for your rental property. Typical loan-related expenses include:

    • Points
    • Loan origination and loan assumption fees
    • Mortgage insurance premiums
    • Application fees
    • Credit report fees
    • Appraisal fees (if required by the lender)

    This TurboTax link https://What can I deduct when refinancing rental property? has information you may find useful.

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