topic How does adding more 1098 reduce your return? in Get your taxes done using TurboTax

How does adding more 1098 reduce your return?

jyeh74 — Tue, 10 Feb 2026 10:45:47 GMT

I realized I missed more interest deductions. So I added the value of interest from another 1098. I noticed that the overall refund decreased. Yes, interest income is limited based on when the loan was taken out and also the dollar amount of the loan. But the refund should stay the same, not decrease, when you add more interest deductions. What happened?

Re: How does adding more 1098 reduce your return?

MonikaK1 — Mon, 26 Feb 2024 23:14:00 GMT

You can preview your return before filing to find out how your taxes were calculated. The refund meter may not always be updated immediately to match your entries.

You can view your entire return or just your 1040 form before you e-file:

Sign in to your TurboTax account.
Open or continue your return.
Select Tax Tools from the menu (if you don't see this, select the menu icon in the upper-left corner).
With the Tax Tools menu open, you can then:
- Preview your entire return: Select Print Center and then Print, save or preview this year's return (you may be asked to register or pay first).
- View only your 1040 form: Select Tools. Next, select View Tax Summary in the pop-up, then Preview my 1040 in the left menu.

See here for more details.

If the results still aren't what you expected, go back to the interest deduction section and review the entire interview. There are several questions that, if answered incorrectly, will change the amount of the deduction.

Taxes are often calculated using a different method than the tax tables. For example, if you have capital gains, the tax on those is calculated at the capital gain rate for your income level. If you are self-employed, you may have self-employment taxes in addition to income taxes. Self-employment taxes wouldn't be affected by the amount of your itemized deductions.

Re: How does adding more 1098 reduce your return?

VolvoGirl — Mon, 26 Feb 2024 23:16:22 GMT

Itemized Deductions or the Standard Deduction can only reduce your income to zero and not create a refund. Then you only get back any withholding taken out.

TurboTax starts off using the Standard deduction, so until your Itemized Deductions are higher than the Standard deduction your refund or tax due would not change. Or it will just change a little at a time as you increase your deductions over the standard amount.

And by increasing your deductions it will decease your income and you may not be getting as many credits as before. Also after you reduce your income to zero there is no more refund to get back but you still may owe for other things like self employment tax or the 10% early withdrawal penalty from 401k or IRA accounts.

Or you are subject to the AMT tax. AMT is Alternative minimum tax. See http://www.irs.gov/taxtopics/tc556.html

and https://ttlc.intuit.com/questions/1899184-what-is-the-alternative-minimum-tax-amt-and-do-i-have-to-pay-it

Or you have self employment tax. You can't reduce the SE tax. If all your tax is self-employment tax rather than income tax, any deductions or an IRA contribution will not lower it. Or you owe something else like a 10% early withdrawal penalty from your 401k or IRA. Or the penalty for not having Health insurance or you need to pay back some of the subsidy. Those are not affected by adding deductions or contributions.

Re: How does adding more 1098 reduce your return?

jyeh74 — Mon, 26 Feb 2024 23:31:11 GMT

@VolvoGirl @MonikaK1

What I can’t figure out with the TT customer representative, is why the sequence of the interest deduction entered, changes the total refund. For example, main loan (1098) on primary home is $10,000. Added a Heloc (1098) on primary home is $1,000. Get refund amount.

Now delete both entries. This time, add Heloc (1098) on primary home is $1,000. Then add main loan (1098) on primary home is $10,000. Exactly the same scenario as above but different sequence. Refund is a little lower than above scenario.

TT Representative told me it should be the same refund amount. The sequence should not matter. She could not resolve it.