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VA Loan Funding Fees and Tax Deductions: A Reader Question

A reader asks, “Can anyone tell me where I can find up-to-date (2013) information of VA home loan funding fee and if it is tax deductible?”

The VA published some revised guidelines for VA loan funding fees in a mortgagee letter back in 2011, which addressed VA loan funding fees through September 2016.

That guidance is available at http://www.benefits.va.gov/homeloans/circulars/26_11_19.pdf as a downloadable .PDF file.

It’s important to note that this file, which contains the most recent updated VA loan funding fee guidelines (and is linked to from the main Funding Fee page found at VA.gov) contains funding fee information for a specific set of dates from 2011 but also the most current VA loan funding fee information effective from November 22,, 2011 to September 30 2016.

We mention this here to help avoid confusion–it’s easy to glance at the VA loan funding fee chart and assume the first set of numbers are the ones currently in effect.

This is not so–the current VA loan funding fee chart has two sections for each VA loan funding fee percentage–one for the now-expired VA loan funding fees in effect in 2011, and another for the VA loan funding fees good until 2016.

To address the second part of this reader question–whether or not a VA loan funding fee is considered tax deductible–it’s our policy not to give out tax advice related to VA home loans for two important reasons. One, we specialize in VA home loans and the issues around them, not taxes. Tax questions should be directed to a tax professional who knows the ins and outs of the tax system.

Two, tax laws change frequently and what was permitted yesterday may not be allowed tomorrow. Tax pros know all the latest rule changes and are the ones best equipped to handle these types of tax-related questions. You can also get tax information from www.IRS.gov which may or may not have specific web pages to answer this question.

For more information on VA loan funding fees, speak to a loan officer or contact the VA directly by calling 1-800 827-1000.

Do you have questions about VA home loans? Ask us in the comments section.

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Bruce Reichstein

About Bruce Reichstein

Experienced VA Loan Mortgage Banker specializing in Military Mortgage lending to US Veterans for over 25 years. (www.VALoans.com). Expert in VA Jumbo Home Loans greater than $417,000 which go up to the maximum 2014 county limits as defined by the Veteran's Administration. Thousands of loans to High Ranking Military Officers, DOD Employees, Airline Pilots and many other Military Heroes who qualify. Welcome opportunities pertaining to online military ventures.

2 Responses to VA Loan Funding Fees and Tax Deductions: A Reader Question

  1. ed goldner says:

    Please clarify….I bought a home in 2013 using my VA loan benefit. Is the VA Funding Fee a tax deductible item in filing my taxes for 2013.??

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