I converted my primary home to a rental mid-year. Do I enter the full amount of mortgage interest & property taxes paid or do I calculate the pro-rata share?

[rudy-kessinger]

Community posts in recent years have had people saying to enter the full amount and that Turbo Tax will split it based on the available date you enter (7/29/24 in my case). However, this year, turbo tax specifically says to "enter the rental portion of mortgage interest reported to you on form 1098" on the mortgage interest section for the rental. Seems like we should now calculate the rental portion ourselves? If so, should I just take 5/12 * total interest paid or sum up the actual interest paid from August - December?

[AmeliesUncle]

When it asks for the number of days of personal use, you need to enter ZERO days.

Because of that, you need to MANUALLY enter the prorated amount.

[rudy-kessinger]

Yes, I entered 0 for personal use. 

So I need to enter 5 months of interest and taxes under the rental, and 7 months under my deductions for the time it was my qualified primary home prior to conversion? 

[AmeliesUncle]

Yes.

[KeshaH]

You will need to manually calculate the portion of your deductible expenses that should be reported under your rental section (Schedule E) and your itemized deductions (Schedule A). You can calculate this proration based on days.

For example: assuming your mortgage interest was $12,000 for the year you'd enter $5,114 as your deductible mortgage interest for the year. (156 days rental / 366 days total * expense)

TurboTax will prorate expenses if you used the property for personal use after you converted it to a rental property.

For example: if you used the property for personal reasons for a week after you converted it to a rental property, TurboTax would calculate how much of the $5,114 calculated in the prior example is deductible as a rental expense. The remainder would be carried to your itemized deductions.