Home:Mortgage Interest v. Loan:Loan Interest

LaurenJah

My head is swimming right now. What is the difference?

volvogirl

Mortgage interest and loan interest are the same thing.  You can use either one.  Do you have a separate Mortgage ACCOUNT set up in addition to the interest categories?  The principle part of the mortgage payment should go to the Mortgage Account.  

jacobs

It only matters if you use Quicken's Tax Report at year-end for doing your taxes. If you use the documents you get from your financial institutions, then it probably doesn't matter at all.

The difference is that Home:Mortgage Interest is assigned to a line on a tax form, while Loan: Loan Interest is not. If you go to Window > Categories, and double-click on Home:Mortgage Interest, you'll see that this category is assigned to tax form Schedule A, on the line for home mortgage interest.

You can either edit your existing transactions to use Home:Mortage Interest, or you can edit Loan: Loan Interest to use the same tax line. Again, this only matter if you want to see your mortgage interest on Quicken's Tax Schedule report for Schedule A of your taxes.

NotACPA

Is "Home:Mortgage Interest" a category?  Do you have your mortgage enabled for download?

And, the difference would be that mortgage interest can be deducted on your Federal tax return ... most other Interest can't.

LaurenJah

No. I am not using the auto download as the original bank was not listed.

Yes. It is a category. I have been using loan interest and loan principal. I think that I should be using Home: Mortgage Interest and Home:Mortgage Rent.

NotACPA

Your mortgage  loan should be set up in Q as a liability account ... and instead of your "Loan Principal" category lyu should be showing the principal portion of your payment as a transfer to that loan account.  THUS, you'll be able to see the reduction in amount owed with each payment.

BUT, what does "Rent" have to do with things?

volvogirl

Mortgage interest and loan interest are the same thing.  You can use either one.  Do you have a separate Mortgage ACCOUNT set up in addition to the interest categories?  The principle part of the mortgage payment should go to the Mortgage Account.  

jacobs

It only matters if you use Quicken's Tax Report at year-end for doing your taxes. If you use the documents you get from your financial institutions, then it probably doesn't matter at all.

The difference is that Home:Mortgage Interest is assigned to a line on a tax form, while Loan: Loan Interest is not. If you go to Window > Categories, and double-click on Home:Mortgage Interest, you'll see that this category is assigned to tax form Schedule A, on the line for home mortgage interest.

You can either edit your existing transactions to use Home:Mortage Interest, or you can edit Loan: Loan Interest to use the same tax line. Again, this only matter if you want to see your mortgage interest on Quicken's Tax Schedule report for Schedule A of your taxes.

LaurenJah

@NotACPA The categories that I have noted were created by Quicken - NOT me.

LaurenJah

@jacobs Thank you for clarifying that. I am just trying to keep consistent in logging and keeping track of the income and outflows. I will use the bank loan documents for tax purposes when reporting to the IRS.

LaurenJah

@volvogirl Thank you.