You may have tax deductions you can use if you have a FHA-insured Home Equity Conversion Mortgage (HECM).
Tom Davison’s in-depth article on reverse mortgage’s tax opportunities and obligations for annual tax reporting.
Davison includes information on the following topics:
- Loan Proceeds are Not Taxable Income
- Interest Deduction
- Mortgage Insurance Premium (MIP) Deduction
- Interest on Acquisition Debt versus Home Equity Debt
- Real Estate Tax Deduction
Davison also points out that the IRS Publication 17, “Your Federal Income Tax,” is wrong saying that that “interest… isn’t deductible until the loan is paid in full.”
Read more on ToolsforRetirementPlanning.com or contact me for a recommendation to a tax professional for advice, especially as it applies to your situation.