Home Mortgage Interest Deduction

[mbrafman]

I am single.

I purchased a home in 2024.

It is my primary residence.

I purchased the home with my mother. We are equal owners.

The loan balance is 534,011.00.

We paid19,719.22 interest in 2024.

I have a second home which I purchased in 2013.

It is not my primary home.

I am the sole owner of this home.

The loan balence is 308,942.69.

I paid 9,494.38 interest in 2024.

So, the total interest paid in 2024 was 29213.

But Turbo Tas calculted the deduction as 3,214.

In 2023 I was able to deduct all the 9,840 iterest on the morgage on my second home.

Why is my deduction only 3,214 in 2024?

[LindaS5247]

You should go back and make sure your Form 1098 entries are correct and make sure you answered the follow-up questions accurately.

To get back to your Form 1098 screens, you can do the following:

1. Click on the search icon at the top right of your TurboTax screen
2. Type "1098" in the search bar
3. Click on the link "Jump to 1098"
4. Review your 1098 entries to make sure all numbers are correct and that you answered the follow-up questions accurately.

There is a cap on how much of your mortgage interest can be deducted. The limit is the mortgage interest paid on the first $750,000 of indebtedness for a single individual or married couple filing jointly, or $375,000 if you're Married Filing Separately.
 

You are both entitled to claim mortgage interest if the house is in both names. Do you share the interest deduction?

Also, did you answer the question "Have you used the money from this loan exclusively on this home?" as no? If you did, you will be limited in your mortgage interest deduction.

You have to answer "Yes' to "Is this loan secured by a property of yours"

If your second home is rented out for part of the year, you have to use it for more than 14 days or more than 10 percent of the number of days you rented it out at fair market value (whichever number of days is larger) for the home to be considered a second home for tax purposes. If you use the home you rent out for fewer than the required number of days, your home is considered a rental property, not a second home and the interest will not be deductible.

Your TurboTax screen should look something like this:

 

If you answered that you did not use all of the money from your mortgage loan exclusively  for your  this home, this will reduce your deduction.

You must have answered yes to "Is this loan secured by a property of yours?" for your mortgage interest to be deductible.

Click here for "Deducting Mortgage Interest FAQs"

[smokinjack1559]

I do not rent the econd home.

I did everything as outlined in your reply but the total interest deduction still is 3,214.

I share the interest on my primary home with my mother.

I think my 2024 interest deduction should be 9,494.38 (second home) + .5x19,719.22(primary home) =19353.99

[AmyC]

You have two homes and the two balances are being added together and limiting the mortgage interest. The program and the worksheets are trying to get an accurate final number on your tax return to submit to the IRS.

Since  you know the correct answer, enter a mortgage balance so that together they are less than $750,000 and enter only the portion of the interest you are entitled to claim.

Even easier method -

You can actually just make one mortgage interest entry for the correct amount and select a value below $750,000. Your sch A only shows the total being claimed. Nothing else goes to the IRS. The IRS already received your 1098 forms from the mortgage companies. 

@smokinjack1559