In 2021, I had one mortgage for 3 months and another for 8. When computing the average, it actually just computed the sum. This is just wrong. Any ideas to fix?

Forum|Forum|4 years ago
February 18, 2022
2 replies
26 views

Only one mortgage was held at a time. Due to the way they pro rate the mortgage interest, this is a $10,000 error on my deductions.

TurboTax Premier Online

Rainman12

Alumni - Champ

Entering sum of interest as reported via each Form 1098 is correct.

jeffrey_aguileraAuthor

Level 2

It didn't add the sum of interests. It added the sum of the two principle values for loans held at different times. And then claimed this was the average outstanding loan. It's off by a factor of 2.

The law says I can deduct interest on up to $750,000 of my mortgage. At an average of 3%, that would be $22,500 per year. But Turbo Tax computed around $10,000, because it divided 750000/(sum of all loans) rather than 750000/(average loan held in any month).

This is a huge difference and a big error.