I called and reported this issue to TurboTax on 1/31/21, but I don't have confidence they will fix it. I will check future updates to see if they do. In the meantime, I ended up manually overriding the home interest deduction worksheet in the Forms view (TurboTax Premier PC download version, button in the top right, look for "Ded Home Mort" form). If you click on the number, you can overwrite the calculation. On line 1, put the average value of original acquisition debt. If you cashed-out, reduce it to only be the acquisition debt. Then on line 7, put the cash out value (or $0 if no cash out). Then line 11 should accurately calculate your original acquisition debt and apply toward the 1098 interest reported in line 13. Hope that helps! Like if it did. 🙂
