How do I answer these questions for 3, 1098 Tax Forms (mortgage refinance 2020 tax year):

[eaudejulia]

Question #1: "Was this loan paid off or refinanced with a different lender in 2020"
Question #2: "Is this loan a home equity line of credit or a loan you've ever refinanced?"

1098 Form #1: Original loan with ABC Bank.
1098 Form #2: Refinance with XYZ Bank.
1098 Form #3: LMN Bank (current loan holder) Purchased loan from XYZ Bank after refinance

[DMarkM1]

Ideally, you will enter the forms in the order they occurred. So first delete them all from TurboTax. 

Form 1: Original loan Q1 - Yes  Q2 - No

Form 2: Refi loan Q1 - Yes  Q2 - Yes

Form 3: Loan Purchase  Q1- NO  Q2 Yes

Having said that, entering multiple Forms 1098 is a known issue.  Some TurboTax customers are experiencing an issue with their Home Mortgage Average Balance. This can cause in the the Home Mortgage Interest to be incorrectly limited.

If you're experiencing the issue above,  please go here to receive email notifications when any updates related to this issue become available.

[eaudejulia]

Hi DMARKM1, thank you for the quick reply. Just a quick follow-up question/looking for clarification: Why is Form 3, Q1 "No" and not "Yes"? Wasn't it technically "  Was this loan ... refinanced with a different lender in 2020? " 

Or is it "No" because technically its the same refinanced loan, just purchased by LMN Bank? 

Thanks again 🙂 

[Cynthiad66]

That one is not considered a refinance.  It was bought out with the same terms.