Hi,
I am on an H1B visa and have been working in the US for 4+ years. I purchased a condo (only property I own) in India 3 yrs ago (2006) and got a mortgage (through a bank in India). I make a monthly mortgage payment out of my salary here (I have no other income) to this bank in India.
On advice of my tax filers, I claimed the interest deduction on my US tax return (I don't file taxes in India as I don't have any income there). I did this for the first time for the 2008 tax year and the refund came through without any hassle. Now I am wondering whether to amend my previous two years (2006 and 2007) tax returns to claim the interest deduction since I didn't claim it for those tax years.
I am being now told by a different CPA that there is a possibility that I could be asked to withhold 30% of the interest payment since this bank that I make my mortgage payment to doesn't file taxes in the US and doesn't provide a 1098 either.
So my question is, is there a risk of the IRS asking me to withhold 30% which would then make this deduction not worth seeking? I have read various threads on many forums on the topic but I am not clear what happens in the case of the property as well as the mortgage provider being foreign based but being paid out of income in the US.
Thanks,
I am on an H1B visa and have been working in the US for 4+ years. I purchased a condo (only property I own) in India 3 yrs ago (2006) and got a mortgage (through a bank in India). I make a monthly mortgage payment out of my salary here (I have no other income) to this bank in India.
On advice of my tax filers, I claimed the interest deduction on my US tax return (I don't file taxes in India as I don't have any income there). I did this for the first time for the 2008 tax year and the refund came through without any hassle. Now I am wondering whether to amend my previous two years (2006 and 2007) tax returns to claim the interest deduction since I didn't claim it for those tax years.
I am being now told by a different CPA that there is a possibility that I could be asked to withhold 30% of the interest payment since this bank that I make my mortgage payment to doesn't file taxes in the US and doesn't provide a 1098 either.
So my question is, is there a risk of the IRS asking me to withhold 30% which would then make this deduction not worth seeking? I have read various threads on many forums on the topic but I am not clear what happens in the case of the property as well as the mortgage provider being foreign based but being paid out of income in the US.
Thanks,