Can I deduct VA funding fee taxes?


Quick Answer

As of January 2015 and for tax years after 2006, the funding fee charged by the Department of Veterans Affairs is fully deductible on Schedule A in the year the mortgage contract was issued, subject to income limitations. The IRS treats the fee as a mortgage insurance premium.

Continue Reading

Full Answer

A VA funding fee is deductible whether it is included in the mortgage or paid in full at the closing. The deductible amount is shown in box 4 of Form 1098, Mortgage Interest Statement. If it is not shown on the form, the taxpayer must contact the mortgage insurance issuer. A taxpayer whose adjusted gross income is more than $109,000 (or $54,000 if married filing separate) cannot deduct mortgage insurance premiums or VA funding fees.

Learn more about Income Tax

Related Questions