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My refund is larger because the mortgage interest and property tax deductions seem to be counted incorrectly when renting primary residence

I have a primary residence which I am renting a portion of.  I have broken it into 2 different properties (besides it being my primary residence).  So one portion is 30% of main house rented .  Another portion is 25% of main house rented (back unit).  Why did i separate them out?  Don't ask. hah.  But basically a CPA had done this for me in the past and i decided to just do the same.  The problem is that when i deduct my Mortgage interest and Property tax from the rental properties (30% and 25% of my primary residence) along with deducting those from my main house, i get a huge number for both.  Can't figure out the calculation on how it got the number.   Basically my total mortgage interest is $26K and the total mortgage deducted came out to over $30k!!  I feel this may be a bug when I let turbotax do the calculation for me (where i input the total mortgage interest for each property).  The same happens with property taxes.  

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4 Replies

My refund is larger because the mortgage interest and property tax deductions seem to be counted incorrectly when renting primary residence

If the total mortgage interest from the mortgage company is $26k, how much

A- did you allocate to Property 1
B- did you allocate to Property 2
C - did you allocate for the primary residence?

Please post the 3 numbers

My refund is larger because the mortgage interest and property tax deductions seem to be counted incorrectly when renting primary residence

I input $26K for all and let TT do the calculations.  So they would be divided like the following (but they aren't once i get to the deductions portion, where it shows more than $30k):

 

A - $26k * .3 (TT does calculations)

B - $26k * .25 (TT does calculations)

C - Primary residence: remaining, where I did my own calculation by multiplying $26k * .45

My refund is larger because the mortgage interest and property tax deductions seem to be counted incorrectly when renting primary residence

I tried to test this in Deluxe CD / download version

 

I  can't see how TT would know that these 2 properties are tied together so that .35+.2+.45 = 100%

 

it works fine if there is only 1 property rented as part of the primary residence. 

 

suggest date entering manually which is an option 

My refund is larger because the mortgage interest and property tax deductions seem to be counted incorrectly when renting primary residence

Ah.. interesting. I guess tt doesn't know how they are connected. That actually makes sense. Yup, going to do it manually. Thanks for looking into it!
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