For HELOC interest to be deductible, it must have been secured by the property and used to buy, build, or substantially improve the home. To enter the interest, follow these steps on TurboTax Online (this will vary slightly for desktop versions):
- Under the Federal menu, choose Deductions & Credits
- Expand the menu for Your Home
- Click Start/Revisit next to Mortgage Interest and Refinancing (Form 1098)
- Either Add another 1098 or click Edit next to the one in question
- Enter the lender information. Click Continue
- Answer the question Do any of these uncommon situations apply. Click Continue
- In testing this process, I was able to enter mortgage interest in box 1, $0 in box 2, and the date the money was borrowed in box 3, such as 08/01/2019. All other boxes were left blank. Click Continue
- Did you pay points in 2019 when you took out the loan? Answer and Continue.
- Is this loan secured by a property of yours? Note: If you answer No, the interest is not deductible.
- Is this loan a home equity line of credit or a loan you've ever refinanced? Answer Yes. Another question will pop up. Answer A home equity line of credit (HELOC)
- Have you used the money from this loan exclusively on this home? Answering Yes notifies the software that the funds were used to update the home.
After completing these steps, I had one error occur during the review. It asked how much money was borrowed during the year. Enter the total maximum that was borrowed from the HELOC in the box above the form. This should clear the error, claim the interest, and allow you to file.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
