topic For the question that asks how much of a refi loan was spent essentially towards the home, do I input the principal balance of my original loan that was full paid? in After you file

For the question that asks how much of a refi loan was spent essentially towards the home, do I input the principal balance of my original loan that was full paid?

Mike60 — Fri, 07 Jun 2019 22:28:47 GMT

I refinanced my original mortgage in 2017. I secured a $203,300 loan, of which $166,559.23 was intended to pay off my existing mortgage. The rest was to pay off other debt. My previous lender actually applied $164,666.95 towards the remaining principal, and $754.72 towards interest. I don't know what amount to enter in TurboTax for that question that asks how much as been spent towards the home. Thank you for your help!

"My previous lender actually applied $164,666.95 towards...

Carl — Fri, 07 Jun 2019 22:28:49 GMT

"My previous lender actually applied $164,666.95 towards the remaining principal, and $754.72 towards interest."

So the total amount applied to the existing mortgage before the refi was $165,421.67. That's the same exact amount of the new loan that is applied to the residence also. Therefore, you will be able to deduct 81.3% of the interest on the new loan, since 81.3% of what you borrowed on the refi is to pay for the house. The remaining 18.7% was used to pay unsecured debt on which the interest on that unsecured debt is not deductible.