Thanks for this but I still ended up with a miscalculation. A few things:
- Both my loans are above the cap. Maybe you can assume the first loan is $2mm and the second is $3mm to make it simpler
- Loan 2 doesn't have an acquisition date. Just an origination date.
For Loan 1, I did everything as you instructed except for 5 because it was a refi with no cash out. It was originated in 2017 so I don't believe this should change anything.
For Loan 2, sorry to add another wrinkle, but Loan 2 was also refinanced with Loan 3 during the year but it was for the same amount (so assume $3mm again). So
- Loan 2 was
- No acquisition date - it was blank
- Loan is secured
- Primary home
- No points
- No to most recent loan
- Loan 3 was
- Entered acquisition date
- Loan is secured
- Primary home
- No points
- Yes to recent
- No to original, yes to refi and no to cash out.
Turbotax seems to be taking the total interest from all three loans and dividing it by $3mm (the newest loan) and capping it at $750K (also just the newest loan). Instead I believe the interest on Loan 1 should be
- Divided by $2mm, giving me credit for more interest to be deducted and
- Capped at $1mm, further giving me credit for more interest to be deducted
Thanks again for your help.
