Posted on: 24th Apr, 2010 05:01 pm
Is the interest added to your principal balance in a loan mod deductible for tax purposes, since it is then considered interest converted to principal? You will now be paying compounded interest on interest.
When it is added to principal it is pricipal and not tax deductible.
You may deduct interest paid. If you did not pay it it is not deductible. It was added to pricincipal, it was not paid. You do pay it as principal over time and that is not deductible.
You may deduct interest paid. If you did not pay it it is not deductible. It was added to pricincipal, it was not paid. You do pay it as principal over time and that is not deductible.
Dear John,
You should NOT comment on the conversion of interest to principal and its tax treatment. It is apparent by your statement that you are not well versed in tax law....
You should NOT comment on the conversion of interest to principal and its tax treatment. It is apparent by your statement that you are not well versed in tax law....
Ethyl,
Why don't you answer the inquirer's question, since you are so well versed in tax law?
Why don't you answer the inquirer's question, since you are so well versed in tax law?
i suggest for easy understanding and right comment to everyone inquiry, an illustration should be incorporated in your query.