It depends but if you are considered a US resident for US income tax purposes, then you will need to report all income from all sources including rental income (regardless if the rental property is located in Australia or if the rental payments goes directly to paying off your Australian loan mortgage payments.)
If you are considered a nonresident alien for US income tax purposes, then you will only report US-sourced income on a Form 1040NR (which is not supported by TurboTax.) so no Australian rental income would need to be reported on your 1040NR
Please note that if you do have to report your Australian rental income on your US resident income tax return, then you will also be able to claim rental expenses (including any foreign mortgage interest payment, foreign property taxes, any property management fees, travel to inspect your foreign rental property and depreciation on your foreign rental property (using a 40 year useful life as opposed to a 27,5 year useful life for a US located rental property.
All your foreign rental income and expense will need to be reported in USD.
The Internal Revenue Service has no official
exchange rate. In general, use the exchange rate prevailing (i.e., the spot
rate) when you received the income. Please refer to the following IRS links for
more information about Foreign
Currency and Currency Exchange Rates and Yearly
Average Currency Exchange Rates
To enter rental
information in TurboTax, log into your tax return (for TurboTax Online sign-in,
click Here and click on "Take
me to my return") type "rental income
and expenses" in the search bar then select "jump to rental income and expenses".
TurboTax will guide you in entering this information.
