I put in my 1098 information and I can see my tax due decrease. My mortgage balance is just over $1M, but it was taken out in early 2017 before the TCJA reduced the limit down to $750k. In any case, I answered the supplemental questions so TurboTax can automatically adjust/reduce the interest eligible to be deducted (a nice improvement from 2020).
Then TurboTax says I might be qualify for a bigger deduction if the original loan was taken out before 12/15/17 and the balance hasn't increased due to a cash out refinance. This is true for me, so I answer Yes. Then TurboTax recalculates and zeroes out my mortgage interest deduction. (I can see that in the wrap up page when it says the standard deduction is best.) That doesn't make any sense. If I click No, then I can see on the wrap up page that the appropriate amount of mortgage interest is used for my itemized deductions.
Has anyone else seen this?
Normally this will clear by deleting the form 1098 and re-entering the form information. Follow these steps.
Nope, doesn't work. The only way TurboTax allows ANY mortgage interest deduction is if I answer "No" to your step 21. I originally answered Yes and used the actual home acquisition date (in 2005), but went through your steps and used the Box 3 date instead (date of refinance in August 2017). Same result - zero allowance for mortgage interest.
If it works for you on a typical (smaller) loan, I suspect you have a bug related to the automatic calculation of allowable interest for loans >$1M. When I answer No in step 21 (and everything else is the same), the exact right amount is allowed (which is less than the total interest paid) for my itemized deductions. This is a very expensive error for TurboTax customers.
It took a few years, but TT finally addressed your issue...