Get It 256

The interest you pay on a mortgage on a home other than your main or second home may be deductible if the proceeds of the loan were used for business, investment, or other deductible purposes. Otherwise, it is considered personal interest and isn't deductible.

1) Refinance Your Existing Mortgage You will not be subject to the NYC Mortgage Recording Tax. For example, if you have a $500,000 mortgage balance and you refinance for $475,000, you will not have to pay the tax.

County Rate Table Loan AmountResidential RateCommercial Rate$500,000 or less2.05%2.05%The borrower pays 1.80% minus $30.00 if the property is 1-2 family and the loan is $10,000 or more.*The borrower pays the entire amount.The lender pays .25% if the property is a 1-6 family.More than $500,0002.175%2.80%2 more rows

An estate or trust that divides the credit among itself and its beneficiaries must submit Form IT-256 with Form IT-205, Fiduciary Income Tax Return, showing each beneficiary's share of the credit. Partners in a partnership and beneficiaries of an estate.

In NYC, the buyer pays a mortgage recording tax rate of 1.8% if the loan is less than $500,000 and 1.925% if more than $500,000 or more. Buyers of commercial property pay 2.55%. These rates are what the buyer is responsible for. Your mortgage lender will also contribute 0.25%.

Tax Deductions You cannot deduct the amount paid for your mortgage recording tax when you file with the IRS. You can, however, add this amount to the cost basis of your property.