I'm using the desktop version. I had a house we sold in 2019 so I have a 1098 for that, and in 2019 I bought a house with a loan that was sold and later refinanced, so I have 3 1098s for that house. 4 1098s total for 2 loans. I am having this same problem as the rest.
I entered the 1098 for the house we sold in 2019 - very straightforward. I entered the first two loans for the new house as one loan and combined the interest on the 1098s. I checked the box that says what I'm reporting is not what's printed on the form and it had me enter an explanation. That way I treated it as one loan, which it kind of is, and checked the box that it was refinanced. I also entered the new refi - very straightforward.
Then I went to the Deductible Mortgage Interest worksheet and entered all four loans in separately, it calculated the correct amounts for the average loan balances - note that the "ending balance" it asks for each loan is the remaining balance when the loan was sold or paid off, not "$0". You will need to know how much principal was applied to each loan during the year, if you can sign in to your mortgage holder online or have the paperwork from the loan refi it will help.
With these two things I don't have to manually check the box that my mortgage interest should be limited on the Tax and Interest Deduction Worksheet, and TurboTax gives me the full interest deduction. I don't know if this is ultimately the best solution, I'm not a tax expert but it makes sense and the numbers are documented on the worksheets if the IRS wants the details.
I agree that Intuit really needs to improve this, a lot of people's loans get sold and it should be set up that if I answer the questions TT asks, I get the right tax calculation like they say it will.
