I'm using Turbotax premier desktop version since it gives more More flexibility.
I'm unclear what happened in your update. Do you mean that you deleted them and re-entered them and TurboTax is still coming up with the same answers? If so, good, that means it probably calculated correctly the first time.
I meant I initially removed the refinance 1098 and then added that again but no change in my tax (same numbers as when I fixed the date as you suggested -- Actually the numbers were the same as before I fixed the date in my refinance 1098). I was unsure so I just removed all of my 1098 forms (first 1098 and refinance 1098) and then re-entered both of them using the same answers as before including the corrected date based on your suggestion. The results didn't change my fed tax and state refund
- Same as when I had the wrong date
- Same as after I corrected the date
So I guess Turbotax probably calculated correctly. I'm curious if this happened before where Turbotax may have a bug and the user is forced to remove the entry to reset the calculation?
When you said you removed the second and your refund went down a little bit, yes, that is normal. Your refund should go down when you delete that form since you are no longer receiving a deduction for the mortgage interest reported on that second 1098.
That makes sense.
Sometimes, in situations like yours where the refinance is very late in the year, the taxes owed may actually increase when you enter the refinance 1098. This is not common, but it can happen, especially since it looks like you rolled some of the refinance costs into the loan making it have a slightly higher average balance than your first loan.
that's true that my balance is a bit higher than the previous balance but the payment for the refinance loan didn't kick in until a month later. I actually didn't think about the tax implication but it seems it's the default refinance process.
So it seems that the purpose of entering the mortgage interest is to deduct it from my tax but in this case entering the refinance 1098 interest increase my federal tax (state refund goes up slightly), would it makes sense to even ignore the second refinance 1098? I'll keep what I entered but I'm just curious if this is required.
My understanding is that for any deduction that can help offset my tax, it is optional (since this is considered a gain for the IRS if I don't include it). For example, if I have a capital loss trading stocks, I can choose to not claim it as a deduction for the tax year, but if I have a capital gain, I must report it since this is taxable. So would this be the same case for my refinance 1098 here?
