After I enter my 1098s, it asks me if I need to limit my mortgage interest deduction, I select yes, and it just re-selects no

[pwillsey4]

I have a mortgage from before Dec 2017 (for ~700K) and one from after (for ~500K), I believe I need to limit my mortgage interest deduction, but Turbo Tax won't let me do this.

I get to this screen after entering my 1098s, I initially selected No, but now when I select Yes, it just reverts back to No

You may need to limit the deductible mortgage interest on your home acquisition debt if any of these situations apply:
Average loan balance exceeds $1 million ($500,000 if Married Filing Separately) for loans secured on or before December 15, 2017.
Average loan balance exceeds $750,000 ($375,000 if Married Filing Separately) for loans secured after December 15, 2017.


Yes, one or all of these situations apply to me.

No, none of these situations apply to me.

[DaveF1006]

if you have multiple 1098's, please refer to this Turbo Tax link that explains how to enter these without error messages. This is particularly useful if one or more 1098 was issued because you refinanced your mortgage.

[pwillsey4]

I followed these instructions, I'm actually not getting an error message, but when I check the box that says I need to limit my mortgage interest deduction, it never takes me anywhere to do that. When I navigate back to the 1098 screen and click continue the check box has reverted back to "none of these situations apply to me".

EDIT:

I believe I need to edit box 8a on my schedule A form, I was able to do this last year, after I calculated my mortgage interest deduction limit using an IRS worksheet. The question Turbotax asks here is really misleading because it implies that if you have mortgage debt before Dec 2017 and after Dec 2017 that you only have to care about the average balance of the loans before Dec 2017 being less than 1 million and the loans from after Dec 2017 being less than 750,000, but that's not true.

[ReneeM7122]

The limit could have to do with whether you paid points, and if you refinanced and answered a question incorrectly, the software could be adding the loan amounts together and creating the limitation.  For the original loan which was paid off due to the refinance, make sure to select that it was paid off or refinanced with another lender, that it is secured by a property of yours, and that it is the original loan you used to buy your home.

@pwillsey4

[pwillsey4]

I paid no points, and I did refinance, I've answered all of those questions correctly I believe. This feels like a bug to me since when I navigate back the answer always switches back to "No"

[Cynthiad66]

There is a problem in the Home Mortgage Interest area of TurboTax.  TurboTax is working to fix the problems as well as other software issues.   If you have more than one Form 1098INT please try this below:

If there is a refi and there was an outstanding mortgage principal listed in both of them on Line 2 on the 1098. When you do put an outstanding balance in both forms, then the program adds them together and if that number is greater than $750k, then it puts you in the category to "limit interest". To get that to go away, you need to go back to the deductions section and click on "edit" mortgage interest statement. Change the line 2 of the mortgage that you no longer owe on (like the one that you refinanced and paid off) to a 0 (zero) because you have refinanced out of that loan and no longer have an "outstanding mortgage principal". Once you change one of them to zero (the one that was paid off by the refinance) then it should no longer pop up with that error at the end when you go to file. 

If this did not help, contact us again and give us information about your Loans for your home mortgage.  Or keep checking back to see if the issue is fixed.  TurboTax is working to get this fixed along with several other required updates to the software.

Your deduction is generally limited if all mortgages used to buy, construct, or improve your first home (and second home if applicable) total more than $1 million ($500,000 if you use married filing separately status) for tax years prior to 2018. Beginning in 2018, this limit is lowered to $750,000. Mortgages that existed as of December 14, 2017 will continue to receive the same tax treatment as under the old rules.

For tax years before 2018, you can also generally deduct interest on home equity debt of up to $100,000 ($50,000 if you're married and file separately) regardless of how you use the loan proceeds.

For details, see IRS Publication 936: Home Mortgage Interest Deduction.

Feb 25, 2021 at 1:09 PM

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[pwillsey4]

I understand there is a bug around entering multiple 1098s for the same mortgage (when you refi), turbotax has provided a workaround for this, you basically amalgamate them into one 1098, that's not really my issue. I have about 1.2M in mortgage debt, some from before 2018 and some from after, but either way I need to limit my mortgage interest deduction, in order to do this I need to check the box "Yes" box in the follow up question about mortgage interest after I click continue on the 1098 screen. I did this last year and it takes you to a different screen where you can say how much is limited. This year when I click that box, it doesn't take me anywhere and when I navigate back to that question it has been reset to "No"