Re: We converted our home to a rental property in ...
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amandacr22
New Member

We converted our home to a rental property in 2019. When entering our mortgage interest and property taxes from my 1098 for our personal deductions, do I need to prorate

I already entered a portion of the interest and taxes into the rental property section.
2 Replies
AnnetteB6
Employee Tax Expert

We converted our home to a rental property in 2019. When entering our mortgage interest and property taxes from my 1098 for our personal deductions, do I need to prorate

Yes, you will need to prorate the amount when you are entering your personal deductions.  Watch the screens carefully to be sure that an amount was not already brought to the personal section from the rental income and expenses section.  If the personal portion is carried to Schedule A from Schedule E, there will be messages on the screen alerting you that mortgage interest and taxes were already entered in another section.  

 

 

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Carl
Level 15

We converted our home to a rental property in 2019. When entering our mortgage interest and property taxes from my 1098 for our personal deductions, do I need to prorate

Actually, it depends on what you select.

If you elect to have the program do the splits and pro-rate for you, then you will enter the *total* amount of property tax paid, and the *total* amount of mortgage interest paid. Then the program will do the splits for you, allocating mortgage interest and property taxes to the SCH E for the period of time it was a rental, and to the SCH A for the period of time it was personal use.

But regardless of what you select, you will have to pro-rate the insurance manually yourself. Remember, you can only deduct the property insurance on the SCH E for the period of time it was a rental. Insurance for the period of time it was personal use is not deductibe anywhere on your tax tax return.

So whenyou get to the Deductions and Credits tab and start working through the "your home" section, make sure to read the small print on "EVERY" screen. Especially if you elected to have the program do the splits for you, as that small print will matter, big time.

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