topic Mortgage interest smart sheet v.s. schedule E's mortgage interest fill-in in Get your taxes done using TurboTax

Mortgage interest smart sheet v.s. schedule E's mortgage interest fill-in

davy_xyly — Mon, 17 Feb 2025 01:01:34 GMT

I rent part of my home out, so I need to distribute mortgage interest across rental income (schedule E) and schedule A. In the past few years with turbotax I calculated and distributed mortage interest by myself manually, but this year it seems "Mortgage Interest Limited Smart Worksheet" will add the amount together with what I entered in schedule E's "mortgage smart sheet" to the schedule A (which definitely double counted the interest for itemized deduction).

So what should I do? From my current exploration, I could make the amount from smart worksheet to be zero to get schedule A right, but box will becomes red and not sure if this is good.

(This screenshot is the mortgage smart sheet that has all the mortage information that automatically calculated the qualified part. Currently I make the amount of box A2 to be 0 so that scheduleA does not double count the interest)

(this one is the smart worksheet in schedule E, that fills in manually. It seems that I have to put the amount here to make the schedule E correctly deduct my interest from rental income)

Re: Mortgage interest smart sheet v.s. schedule E's mortgage interest fill-in

MarilynG1 — Wed, 19 Feb 2025 01:47:16 GMT

Actually, if you enter your Mortgage Interest in the Rental Expense section first, TurboTax calculates what should go on Schedule E and puts the balance on Schedule A for you. Delete your entry under Deductions/Credits for Mortgage Interest, and go back to the Property Profile/Asset sections in the Rental section.

Here's some info:

"In TurboTax you would enter on the screen: Do Any of These Situations Apply to this Property? you need to check the box, I rent out part of my home

A few screens later you can indicate "Yes" that you will let TurboTax Calculate Your Expense Deductions for You. Another question will appear on the screen that states:

Just enter the percentage of your property that was rented?

Then you can enter your rental income and enter your expenses (100% of the expense) in the Expenses section. TurboTax will allocate the amount for your itemized deductions so do not also enter them there."

Make sure you indicate 0 days of Personal Use for the Rental Portion while it was rented.

Re: Mortgage interest smart sheet v.s. schedule E's mortgage interest fill-in

davy_xyly — Fri, 21 Feb 2025 08:59:07 GMT

Thanks very much for the reply! It helps a lot.

I delete "entry under Deductions/Credits for Mortgage Interest, " and now the amount is correct. When I run the final smart check, it pops error shown in Schedule A Tax and Interest Deduction Worksheet (the attached image), that requires a non-zero value . (But there is no Mortgage work sheet already) Should I just proceed or use 1 dollar here?

Another issue is that in CA state tax does not have that 750k limit for mortgage intetest deduction, which means I will have different amount for itemized deduction for federal and state taxes. I had to manually overriden values in the schedule CA and CA's schedule E :(

Re: Mortgage interest smart sheet v.s. schedule E's mortgage interest fill-in

DaveF1006 — Sat, 22 Feb 2025 00:22:19 GMT

It depends. Sometimes these things appear for no rhyme or reason. Here put a 1 in the box so that you can move on with your return without these nagging errors.