No, it may not. Therefore, you will have to manually calculate the remaining mortgage amount, the mortgage interest applicable to that mortgage amount, and finally calculate how much of the mortgage interest you can deduct on Schedule A given the $750,000 limit on aggregate mortgage indebtedness. You are correct, in that you should enter your rental property information first (in your case the rental room) as TurboTax will allocate the appropriate percentage of expenses to the rental room including the allocable percentage of the mortgage.
After entering the essential information about your rental room, you may see a screen indicating that the remaining portion of the mortgage interest, i.e., the mortgage interest that applies to your personal residence, will be transferred to Schedule A. However, double check that entry to make sure it does not include mortgage interest that is allocable to the aggregate indebtedness greater than $750,000. If it does, you will need to manually adjust the amount.
Follow-up with us and provide additional information if appropriate so that we can better understand your tax situation.
@lyu
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