Option 2 (using the Seller-Financed Mortage Interest Statement) still has a problem.
We held a mortgage on our son's house, which he did not buy from us. This is similar to what others have described. This year he sold that house and bought a different one. We are not involved in the financing of the new house, but we received interest on the old one.
The problem is this: the statement in TurboTax assumes that the payer's address is the property address. In this case that is not true.
The actual IRS 1098 which we have used in previous years (not using TurboTax) has places for both addresses. I tried filling out the one it TurboTax, but it seems to assume that we paid the interest, which is the opposite of the truth.
Suggestion to Intuit: Allow us to use the 1098 from, but add a checkbox for whether the amounts are paid or received. This seems like an easy way to collect all of the right information and put the results on the right form.
