How turbo tax calculate the percentage of the mortgage interest for the rental income on the primary residence

[Lee-Ng]

I rent out a room in my primary residence, I would like to understand how Turbo Tax calculate the percentage of the mortgage interest, property tax, etc. Please give an example so that it helps me to know the formula. Thanks

[PaulaM · Accepted solution]

TurboTax will calculate the amount to allocate based on the number that you input for the rental use percentage. Calculate the percentage as the square footage of room/square footage of entire home.

For example: You enter the rental use percentage as 25% and the cost of your mortgage interest is $10,000. TurboTax will allocate $2,500 to the rental side and $7,500 to the personal side. You won't enter interest again on the personal side.

You don't have to have TurboTax do the calculation. You can just enter the proportionate share yourself in both sections.

Also, under the Property Profile, indicate that you rented a part of your home on the page, Do Any of These Situations Apply to This Property? 

See attachments.

[Lee-Ng]

Thanks Paula! However, I forgot I only rented the room from Jan to Aug (244 days). How will the calculation formula looks like; please use the example above you provided. Thanks

[PaulaM]

If you rented a part  of your home for less than the entire year, then it is best to enter your own allocation. TurboTax will not be able to calculate partial year rented and the rental use portion. So to manually allocate for the the above $10,000 interest example: $10,000 X .25 = $2,500 rental sq.ft use. $2,500 X 244/365= $1,671 amount of interest to rental side. The remainder, $8,329 to the personal side.

[justmejaime21]

Hello, 

 the program asked me about my rental income. I rented my second home for 10 mos and used it for 2 mos as a vacation house. Now, when it gets to the Mortgage interest, I entered my primary home's info, then the 2nd home which is my rental home for 10 most, What do I put? the entire interest amount in my 1098? will it do the computation for me? Thanks