I have spent hours on the phone and in chat sessions with TurboTax Tax Advisors and Turbo Tax Product experts and still no solution. I took out a HELOC in 2023 and use ALL of the proceeds to buy and modify a NEW house that will be ready to move into in April 2024. Both the Online and Desktop versions claim the interest paid to the HELOC is fully deductible but everything I can find (IRS website and other tax websites, even Turbro Tax website, says this interest can not be deducted). I was using the online version but after several hours on the phone with a tax expert, she gave me a code to download the desktop version saying I can work around the problem using the desktop version. The desktop version has the same problem and I have not found a way to work around it. I have 4 sources of mortgage interest. Three of them can be written off but not the HELO. On Schedule A, it shows the total of all 4 sources. It does correctly check the box that says not all of the proceeds were used to buy or modify the home secured by the loan, but it still deducts the interest. I will be calling again but wanted to post this questions here as well. Line 8 is correctly checked. Line 8 a incorrectly show the sum of all of the interest (it should not include the HELOC interest). Line 8 b correctly shows the interest that was not reported on a 1098 (less than $600 so a 1098 was not required).
How do I work around this issue?
