Need some help. I purchased my home in 2014, then refinanced in 2018 since I had more than 20% equity to remove the HMI/mortgage payment each month. I also took a small cash amount for some improvements as well as other debt consolidation, while still maintaining the 80/20 equity level to not pay HMI. Flash forward to today, and I am trying to figure out how to take the deduction of the mortgage interest that applies to the original loan, not including the amount that was cashed out (which was less than 10% of the current loan amount balance). The software will only let me choose specific items denoting the loan was refi'd or not, and thus if any/all the interest can be considered a deduction. Is there a way to itemize or break this out so I don't lose $10,000 in deduction due to $1,000 that stems from the cashed out amount? It's costing me about $1,100 on my return that I'd like to realize if possible.
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Hello, is anybody out there that can help?? Please....
During the interview when entering the 1098, be sure you indicate (click on) HELC, the next screen will allow you to enter what you cashed out, and how much was for improvements.
After the Tax Cuts and Jobs Act, only the amount you took out as cash that you used to improve will count, even if you did not take out more than the original mortgage amount.
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