You can report $1 as the Box 2 amount if TurboTax is giving you a hard time about $0 for your HELOC.
That said, unless the money you use from your line of credit is specifically used to buy, build, or improve the home that the line of credit is on, then all the debt is considered home equity debt which is not deductible. If that is the case, you do not need to include Form 1098 on your return at all. If you did use it for improvements to your home, then you can deduct the interest. In that case, go ahead and enter $1 as the outstanding mortgage principal and enter the following when TurboTax prompts you:
- Answer Yes to Let's see if this is the most recent form for this loan.
- Answer No to Is this the original loan used to buy your property?
- Answer Yes to Is this loan a HELOC or a refinance?
- Answer Yes to Did you take cash out?
- Answer Have you used the money from this loan exclusively on this home?
- If you answered No, enter the balance on January 1, 2022 and the amount of home acquisition debt in the proper fields. The home acquisition debt should be the amount used to improve your home.
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