Bought a home in 2025? Don’t forget this at tax time
By James L. C. Meyers, Broker & REALTOR®, Block City Homes
If you purchased a home last year, you probably remember signing a mountain of paperwork at closing. Once the keys were in your hand, that stack of documents likely went into a folder, a drawer… or a box that hasn’t been opened since moving day.
One of those documents — your real estate settlement statement (also called a closing disclosure or closing statement) — can be surprisingly important when it’s time to prepare your tax return.
While your tax professional will guide you on what applies to your specific situation, here are a few items from your home purchase that are commonly discussed at tax time.
What Is a Settlement Statement?
Your settlement statement is the document that itemizes the financial side of your real estate transaction. It shows who paid for what at closing, including loan costs, prepaid items, and prorated expenses like property taxes.
It’s essentially the financial summary of your home purchase — and a useful reference for your tax preparer.
Items Your Tax Professional May Ask About
Every buyer’s situation is different, but these are some of the more commonly reviewed areas:
Mortgage Interest Paid at Closing
If you prepaid interest at closing (sometimes called “per diem interest”), that amount may be relevant when calculating your mortgage interest for the year.
Property Taxes Paid at Closing
In many transactions, buyers reimburse the seller for property taxes the seller already paid. These prorated tax payments may be important for your tax records.
Points or Loan Origination Fees
If you paid points to reduce your mortgage interest rate, those may be handled differently than other loan costs. Your settlement statement will show these clearly.
Why This Matters
Your lender will send you certain tax forms, but not everything connected to your home purchase appears on those forms. That’s why your settlement statement can be such a helpful supporting document when preparing your return.
A Quick Reminder
If you were one of my clients and you can’t seem to find your statement, don’t worry, I’m always happy to help you locate copies of your closing documents if you need them. But for tax advice, be sure to consult with a qualified tax professional. They can review your full financial picture and make sure everything is handled correctly.
James L. C. Meyers is a second-generation broker and owner of Block City Homes who helps families buy and sell with confidence through every stage of homeownership across Greater Chattanooga, Northwest Georgia, and Northeast Alabama.
