I have a common issue that I don't think Turbo Tax is apt to handle. (shame on them). I sold a house in July and bought a new one. My mortage on the first one was 450,000 ($10,975 in interest) and the mortgage on the new one is 724,900 ($20,730 in interest). Turbo tax is limiting my interest deduction because I am over the $750,000 threshold; however, I didnt have these mortgages at the same time! If I am correct, I should be able to deduct the full interest from both loans.
450,000*6/12=$250,000
724900*6/12=$362,450
For a total of $612,450. Which is under the $750,000 threshold! Turbo tax says my mortgage interest deduction should be $20,956, but I believe it should be $31,705.....
Am I correct and if so, Turbo Tax needs to fix this issue immediately because tons of customers buy and sell homes during the same tax year!
