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Mortgage Interest Reporting: A Mortgage Lender's Guide to IRS Rules for Reporting Interest on Real Estate Loans.

Mortgage Interest Reporting: A Mortgage Lender's Guide to IRS Rules for Reporting Interest on Real Estate Loans

Mortgage Bankers Association of America, publishers 1125 15th Street, N.W. Washington, D.C. 20005 1991, 150 pages, $25 (MBA members), $30 (nonmembers) Soft cover

Mortgage Interest Reporting addresses the current Internal Revenue Service (IRS) regulations for the reporting of mortgage interest. It also includes the recent IRS announcement on the reporting of mortgage points included as an addendum. Mortgage bankers are affected by the requirements that apply to the reporting of interest received by mortgage servicing operations on qualified mortgages and the penalties resulting from noncompliance.

Mortgage Interest Reporting includes copies of IRS guidance issued under the IRS code Section 6050H and relevant interest reporting forms. Further clarity is given to reporting requirements on who must report, when reporting must be done, how to report, the types of loans subject to reporting and which borrowers must receive an information return.

IRS penalties imposed from a failure to report interest properly and on a timely basis are also explained, and penalties caused by a failure to provide information returns to borrowers are discussed. Since IMPACT, the 1989 penalty reform legislation, was passed, mortgage lenders failing to report to the IRS risk penalties of $50 per failure, up to a maximum of $250,000. Penalties for failure to provide borrower information returns are $50 per return, up to a maximum of $100,000. An increase in audit activities by the IRS in the area of interest reporting is responsible for penalties becoming more commonplace.

Mortgage Interest Reporting is an invaluable guide for any institution engaging in mortgage transactions. Lenders are well-advised to review their mortgage interest reporting operations with the help of this book to guard against inadvertent error, and to minimize exposure to IRS penalties.
COPYRIGHT 1991 Mortgage Bankers Association of America
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991 Gale, Cengage Learning. All rights reserved.

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Publication:Mortgage Banking
Article Type:Book Review
Date:Mar 1, 1991
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