Get your taxes done using TurboTax

I appreciate your encouragement but wouldn't exactly say that I "figured things out"...

This is a software glitch. I just spent 2 hours on the phone with a TurboTax representative and we eventually created a workaround to fool the software into transferring my mortgage intersest onto Sch A.

Here's the issue and the fix: After you enter all your 1098s, you may get a screen saying you might have to limit your mortgage interest deduction if pre-2017 mortgage loans were over $1M or post-2017 loans were over $750K. Now, if you refinanced a decent sized mortage during 2019, as I did, the total of the old (paid off) and new (currently being paid) mortgages can exceed $750K, and TurboTax reads this as though you're carrying both of them. You know, however, that you are certainly NOT carrying a mortgage over $750K. So you click "No, neither of those situations applies to me," you then see the mortgage interest deduction driving a large tax refund, and you mentally picture a nice beach somewhere or at least a break from working on your taxes. However, when you then click "Continue", the refund will rapidly convert to a large payable because the software doesn't believe you, and refuses to actually transfer the mortgage interest number to Sch A. 

So here's the fix: Click instead on: "Yes, that situation applies to me," lying to TurboTax by claiming that you do, in fact, owe more than $750K on your home. When you get the pop-up box asking you what the corrected amount of the mortgage interest deduction should be, just input whatever numbers were on your 1098s, and your mortgage interest will flow nicely over to your Sch A. You are now back on the beach.

Now, in my case, my TurboTax helper got nervous that lying to TurboTax might cause me problems even though there was nothing at all on Sch A to flag this amount as manipulated in any way - which, being straight off the 1098s, was a "pure" number in any case. But after looking at couple more things, we went back and changed my answer to "No, neither of these situations applies to me," just to see what would happen, and much to our astonishment, the fix held! (However, my NY state return now shows me with over $1M in homeowners debt and I'm still plowing through how to fix that, because it's limiting my interest deduction there.) Regardless, we had seen the refund flip to a large payable at least 8 times before, so we were amazed when it held this time.

I do think it might have something to do with state return software. I've been inputting tax information over the past month as I receive it. All looked good until I opened my state returns last night to work on them, and suddenly my mortgage interest fell off Sch A. Today, I had the state returns already open while we were working through the fix, and everything seems to be holding so far - although, as noted, the information on NY seems funky so I need another look-see.

ALSO - if you are using a Mac and need to send a file to a TurboTax agent for review during your help session, there is no info out there on how to do it - everything you find on-line is for Windows (although nothing states that) - so here's what you do: With TurboTax open, in the very top menu bar where you see an apple logo on the far left and the word TurboTax directly to the right of it, choose the Help option and in a drop-down menu you will see "Send Tax File to TurboTax Agent." Like most things on Mac, it's very simple - once you realize that you're spinning your wheels trying to follow directions for Windows! Hope that helps somebody else- it took my TurboTax helper and me probably 15 or 20 minutes to figure that out... 🙂

Good luck!