Yes, you need your closing statement for your taxes. The closing statement, also known as a settlement statement, is an essential document that outlines the financial details of your home purchase. It contains information that you will need when filing your taxes, including:
- The purchase price of your home
- The amount of your mortgage loan
- The amount of your closing costs
- The amount of your property taxes
- The amount of your homeowners insurance
The closing statement is also important for tracking your homeownership expenses over time. You can use it to calculate your cost basis, which is the amount you have invested in your home. This information is important when you sell your home, as it will help you determine your capital gains or losses.
What is a closing statement?
A closing statement is a document that is prepared by the settlement agent or closing attorney at the closing of a real estate transaction. It outlines the financial details of the transaction, including the purchase price, the amount of the mortgage loan, the closing costs, and the amount of the property taxes. The closing statement is also known as a settlement statement.
What information is included on a closing statement?
The closing statement includes the following information:
- The purchase price of the home
- The amount of the mortgage loan
- The amount of the closing costs
- The amount of the property taxes
- The amount of the homeowners insurance
- The amount of the prepaid interest
- The amount of the escrow deposit
- The amount of the lender’s fees
- The amount of the attorney’s fees
- The amount of the title insurance
- The amount of the recording fees
- The amount of the transfer taxes
Why is the closing statement important?
The closing statement is important for the following reasons:
- It provides a record of the financial details of the real estate transaction.
- It can be used to track homeownership expenses over time.
- It is used to calculate the cost basis of the home.
- It is used to determine capital gains or losses when the home is sold.
How do I get a copy of my closing statement?
You can get a copy of your closing statement from the settlement agent or closing attorney who prepared it. You can also request a copy from the lender or the title company.
What should I do with my closing statement?
You should keep your closing statement in a safe place. You may need it for tax purposes, to track homeownership expenses, or to calculate the cost basis of your home.
Here are some additional tips for using your closing statement:
- Review the closing statement carefully before you sign it. Make sure that all of the information is correct.
- Keep a copy of the closing statement in a safe place. You may need it for tax purposes, to track homeownership expenses, or to calculate the cost basis of your home.
- Use the closing statement to track your homeownership expenses over time. This information can be helpful when you are budgeting for home repairs and maintenance.
- Use the closing statement to calculate the cost basis of your home. This information is important when you sell your home, as it will help you determine your capital gains or losses.
By following these tips, you can make sure that you are using your closing statement to your advantage.
Tax Deductible Closing Costs
FAQ
Do I need my mortgage statement for taxes?
What documents do I need to keep for tax purposes?
Can I deduct closing costs on my taxes?
Do you need bank statements for taxes?
What tax information should be included in a closing statement?
You’ll find all kinds of important tax information included in the closing statement. For example, if you escrow your property tax payments with your mortgage company, they’ll be shown on this form. Any property taxes paid at closing should also appear on your settlement statement.
Do you need a closing statement for a mortgage loan?
The closing statement isn’t just some boring piece of paper. Mortgage loans involve costs whether you’re purchasing or refinancing, and you need to understand what you’re agreeing to before signing on the dotted line. Verify your home buying eligibility. Start here That’s where closing statements come in.
Why do I need a closing statement?
They also serve as a legal record of the home sale. In the unlikely case of a dispute arising, your closing statement can verify the agreed-upon terms. Keep in mind, this statement is the last opportunity to review details about your mortgage loan before closing.
Is a Closing Disclosure tax deductible?
Some things are immediately tax deductible or deductible over time, which is important when preparing a tax return. Other items listed will not benefit you (tax-wise) at all, other than facilitating the property sale. The Closing Disclosure (unlike the old HUD-1) also contains the key terms of your mortgage agreement with the lender.