Question: Can I deduct "points" used to finance a home?

Answer: Points -- or loan discount fees -- are deductible in the year paid for financing used to acquire a personal residence.

Points paid to refinance a home must be paid out over the loan term. Example: if you refinance, get a 15-year, $100,000 loan and pay a point, $1,000, at closing, then you would deduct 1/15th of $1,000 each year. If you paid off the loan in 10 years, any remaining point costs would be deductible in the year the loan was repaid.

Please see a tax pro for specifics.