NLIC.org

Sandra Said:

Please tell me if these are deductible?

We Answered:

Master card interest -- Only if business related.

Dental expenses -- Yes, to the extent that they exceed 7.5% of your AGI

California state income tax -- Yes

Charitable contribution -- Yes, if to a registered charity

Mortgage interest on home purchase (personal) -- Yes

Real estate taxes (personal) -- Yes

Life insurance premiums -- Only if business related, and even then there are limitations

Investment interest -- Yes, but only to the extent of investment income

Automobile registration fees -- No. However if an ad-valorem personal property tax is levied that is deductible. Some states lump this in with the registration fees. That portion is deductible. Business related fees are deductible however.

Contribution to a reelection campaign -- No. Political contributions are never deductible

Luis Said:

Are other mortgage purchasing fees deductions?

We Answered:

Yes and no. If you paid any pre-paid interest, usually referred to as 'points', that money is deductible as mortgage interest.

Application fees, documentation fees, credit check fees, lawyers fees, any fees related to getting the mortgage, are not deductible. Instead, they become part of the cost basis of the property, which is used to determine profit, if any, after a future sale.

Let's say you paid $100K for the house and $1500 in acquisition expenses that are not tax-deductible interest. Your basis in the property is $101,500.

The only exception would be if the fees were necessary in getting a mortgage related to a job-based move. Then, these expenses may be deductible as moving expenses. Only a qualified tax expert can determine this for you.