topic loan deduction is not working correctly in Deductions & credits

loan deduction is not working correctly

smathia — Sun, 12 Jul 2020 19:34:59 GMT

I took a loan for 450k in 2018. This was transferred by the original lender in 2019 to another company (company 1 for which I have 1098). Then I refinanced with company 2 who held my loan for 3 months and then transferred it to a 3rd company who had the loan for 3 more months in 2019.

when I enter the 1098 information for loan deduction -the average loan balance is going over 450k and reducing my deductions instead of sticking with my original 450k (seems like turbo tax is calculating incorrectly) - need help.

Re: loan deduction is not working correctly

Critter-3 — Sun, 12 Jul 2020 19:59:14 GMT

You must enter the 1098 forms in chronological order and complete each screen completely ... by doing so the program will recognize the changes in the mortgage holders. I suggest you delete all the forms you entered and try again.

Re: loan deduction is not working correctly

smathia — Sun, 12 Jul 2020 20:00:11 GMT

thanks will try now

Re: loan deduction is not working correctly

smathia — Sun, 12 Jul 2020 20:07:57 GMT

I tried this out and it doesn't work. I deleted all 3 lenders and then went in and added it again. the question that comes after adding the lenders where it looks for more than 750k balance is "No" for me but it switches automatically to yes and then switches my deduction from itemized to standard which is wrong

Re: loan deduction is not working correctly

stophers — Mon, 13 Jul 2020 02:18:55 GMT

i am having the exact same issue

Re: loan deduction is not working correctly

VictoriaD75 — Mon, 13 Jul 2020 13:32:40 GMT

For desktop versions:

In Forms view, locate and click on Tax & Int Wks on the left from the forms list
On the form, scroll to Mortgage Interest Limited Smart Worksheet
Click on NO to the right of the question, Does your mortgage interest need to be limited

Or, try this in desktop:

In "Forms," find the "Tax and Interest Deduction Worksheet."

Scroll down to the Mortgage Interest Limited Smart Worksheet."

If field A 1 is blank, right click it, and select "Override", then write in the total of mortgage interest paid, from all 1098 forms.

Once field A 1 has the total of mortgage interest paid, copy that amount.

If field A 2 is blank, right click it, and select "Override", then AGAIN write in the total of mortgage interest paid, from all 1098 forms.

For online versions, after entering the 1098 interest information, continue through the screens and TurboTax will ask you if the interest needs to be limited.