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Path: utzoo!watmath!clyde!bonnie!wjh
From: wjh@bonnie.UUCP (Bill Hery)
Newsgroups: net.taxes
Subject: Re: tax deduction of prepaid mortgage interest
Message-ID: <540@bonnie.UUCP>
Date: Mon, 26-Aug-85 13:46:33 EDT
Article-I.D.: bonnie.540
Posted: Mon Aug 26 13:46:33 1985
Date-Received: Tue, 27-Aug-85 02:18:01 EDT
References: <106@decwrl.UUCP>
Organization: AT&T Bell Laboratories, Whippany NJ
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> 
> 	With regard to the comments about the deduction of mortgage interest 
> prepaid in December being assignable to the current year:
> 
> 	>If you want to deduct the Jan 1 payment this year, pay it on Dec. 30.
> 	>...As far as IRS is concerned, it's the date you actually PAID the
> 	>interest that counts.
> 
> 	I believe this is not correct. Sec. 461(g)(1) of the Internal
> Revenue Code states:
>
.... 
> 	IRS Publication 17 (Rev. Nov. 84) in section 29, in the third
> paragraph on page 129 seems to interpret this:
> 
....
> 	If someone has another reference indicating that the mortgage payment
> for January for the following year is deductable for the current year, I'd 
> like to see it. 
> 

I don't remember the exact source, but it was from a book on personal financial
planning (maybe Sylvia Porter's Money Book??) that I read several years ago.
It could have been wrong, or changed shince then.  Any accountants or lawyers out
there know for sure what is corrct?

If it is true that it can only be deducted in the year due, no the year paid, it
seems to be inconsistant with other IRS rules that insist that deductions
be taken in the year that the expense is actually incurred.