|FAQ Keyword 99
||2006 Tax Year
Keyword: Itemized Deductions
Our home was seriously damaged by flooding last year. Are there
special provisions for claiming a loss since our home is located in a declared
Casualty losses not compensated for by insurance or otherwise are generally
deductible only in the year the casualty occurred. However, if you have a
deductible loss from a disaster in an area that is officially designated by
the President of the United States as eligible for federal disaster assistance,
you can choose to deduct that loss on your return for the year immediately
preceding the loss year. In other words, you may treat the loss as having
occurred in either the current year or the previous year, whichever provides
the best tax results for you. If you have already filed your return for the
preceding year, the loss may be claimed by filing an amended return, Form 1040X (PDF), Amended U.S. Individual Income Tax
Return. For more information on disaster area losses (including flood
losses), refer to Tax Topic 515, Disaster Area Losses (Including
Flood Losses), or Publication 547, Casualties, Disasters and
Thefts . Publication 584, Casualty, Disaster, and Theft Loss
Workbook, can be used to help you catalog your property.
If I must deduct points over the life of my mortgage, and I have
a 30 year mortgage, does this mean that I divide the points paid by 30 and
enter that amount on Schedule A?
No, you don't divide the points by 30. If you choose to use the straight-line
method, you need to divide the points by the number of payments over the term
of the loan and deduct points for a year according to the number of payments
made in the year. If the loan ends prematurely, due to payoff or refinance
with a different lender, for example, then the remaining points are deducted
in that year. Points not included in Form 1098 (PDF) (usually
not included on a refinance) should be entered on Form 1040, Schedule A (PDF), Itemized Deductions. For more information,
refer to Publication 936, Home Mortgage Interest Deduction; and Tax Topic 504, Home Mortgage Points.
My spouse and I are filing separate returns. How can we split our
If you and your spouse file separate returns and one of you itemizes deductions,
the other spouse will have a standard deduction of zero. Therefore, the other
spouse should also itemize deductions.
You may be able to claim itemized deductions on a separate return for certain
expenses that you paid separately or jointly with your spouse. Deductible
expenses that are paid out of separate funds, such as medical expenses, are
deductible by the spouse who pays them. If these expenses are paid from community
funds, the deduction may depend on whether or not you live in a community
property state. In a community property state, the deduction is, generally,
divided equally between you and your spouse. For more information refer to Publication 504, Divorced or Separated Individuals; and Publication 555, Community
I am in a disaster area and heard the IRS could help me. What can
the IRS do?
If you have been affected by a Presidentially declared disaster, the IRS
may help you by allowing additional time for filing returns and making payments,
and in some circumstances, waiving penalties if the disaster has caused you
to file or pay late. The IRS may also, provide copies or transcripts of previously
filed returns, free of charge. You may be eligible to file for a casualty
loss deduction on the prior year's tax return, or if you have already filed,
by amended return (Form 1040X). For additional information on this subject,
refer to Tax Topic 515, Casualty, Disaster, and Theft Losses,
and Publication 547, Casualties, Disasters, and Theft.
Are excise taxes for a vehicle deductible?
It has to be a personal property tax, not an excise tax, in order to deduct
it. Deductible personal property taxes are only those based on the value of
personal property such as a boat or car. The tax must be charged to you on
a yearly basis, even if it is collected more than once a year or less than
once a year. To be deductible, the tax must be charged to you and must have
been paid during your tax year. Taxes may be claimed only as an itemized deduction
on Form 1040, Schedule A (PDF), Itemized
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