CA Mortgage Interest Adjustment Incorrect

clpedersen7 — Tue, 03 Mar 2020 16:59:00 GMT

Hi there -

We had a total of 4 1098s this year for our home. The first 1098 was from Lender #1, the second 1098 was from Lender #2 due to the transfer of the loan (not refinance), the third 1098 was from a refi, and the fourth was for our most recent refi. Our loan amount was under $750k so our entire mortgage interest ($30k) was allowed in our Federal Itemized deductions. No issues with our Federal calculations.

When it's time to do our CA Return, TT is showing we need to do -12k mortgage interest adjustment! This doesn't make any sense as we should be able to deduct the full amount in California. Our loan is under $750k and the CA threshold is 1 million. I've read online that this might be a Turbo Tax error since it might be combining the loans since it doesn't know that each loan ended before a new one was issued. This is frustrating! Someone please advise! Thank you.

Re: CA Mortgage Interest Adjustment Incorrect

MarilynG1 — Tue, 03 Mar 2020 19:55:32 GMT

You are correct that you should be able to deduct the full amount of your Mortgage Interest in California, since your loan threshold is under 750K.

You should not have to calculate any adjustment.

Make sure all your 1098 entries have a Loan Origination Date that shows they are sequential, and not overlapping.

Click this link for more info on CA Mortgage Interest Adjustment.

topic CA Mortgage Interest Adjustment Incorrect in State tax filing

CA Mortgage Interest Adjustment Incorrect

Re: CA Mortgage Interest Adjustment Incorrect