There is an entry somewhere that is causing the limitation and it is usually related to entering multiple forms 1098. Try working in the step-by-step mode. For the best results you'll need to delete all the 1098 entries and start fresh.
Follow these steps.
Be advised the mortgage worksheets are not part of the forms that are filed with the IRS. Follow these steps to correct/eliminate the limitation on your mortgage interest deduction:
- Deductions and Credits
- I'll choose what I work on
- Update Mortgage Interest topic
- Delete both 1098s
- Done
- Update the Mortgage interest topic
- Yes
- Put in oldest loan first
- Primary or Secondary Home as needed
- None of the above
- Enter form information from old loan
- Continue
- No points to deduct
- Yes Most Recent if this is the only loan on this home; No if you have another 1098 for a loan on the same home
- Answer the Refi questions as needed
- Continue
- Add a lender
- Same steps as above for the new loan
- Continue
- Done
- If there is a limitation introduced you'll be asked to review the entries to enter any payoff information
- Now you should see the page explaining the limitation
- You can click the help me with this link and see that if you take your loan balance at the beginning of the year box 2 old loan and add it to the balance of new loan at end of year (loan amount 1 Jan 2023) and then divide by 2. If the average is below 750,000 that means all of your interest is deductible.
- In the "Your Adjustments" box enter the total interest paid for 2022 from box 1 of your 1098s
- Continue
If you need you can re-post with specific loan (1098) information.
@cwpete74
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