On the Home Mortgage worksheet, you want to enter the amount of the loan when ton the day you took it out in 2020.
If you aren't able to enter an amount, try to delete Form 1098 and start again.
To delete a form that came in the mail (for example, W-2, 1098, or 1099) it's best to do it from that form's summary screen. Search for the form number (for example, W-2) and select the Jump to link in the search results to get to the summary screen.
How do I view and delete forms in TurboTax Online?
Alternatively, here's the general procedure for viewing the forms list and deleting unwanted forms, schedules, and worksheets in TurboTax Online:
- Open or continue your return in TurboTax.
- In the left menu, select Tax Tools and then Tools.
- In the pop-up window Tool Center, choose Delete a form.
- Select Delete next to the form/schedule/worksheet in the list and follow the instructions.
If this procedure doesn't work for you, please come back here and let us know.
HELOCs are treated differently.
In the Mortgage interest area of the TurboTax interview, you should make a separate entry for your HELOC (as opposed to your regular loan). Go to Deductions & Credits->Your Home->Mortgage Interest, Refinancing, and Insurance and click on Start or Revisit on the right.
The first thing is that TurboTax will ask you the information that is on the 1098. You must enter the information that is on boxes 1, 2, and 3 on the 1098, because these help TurboTax to determine whether or not the interest on your HELOC is deductible.
Continue, and soon you will come to a screen with the title of "Is this the original loan you took out to purchase this property?" Answer "NO" and you will see some more lines added to the screen, so then answer that it is a HELOC. Then next screen will ask you what you used the HELOC loan proceeds for. Depending on your answers, there may be additional screens.
HELOCs are now wrapped into the total limit on tax-deductibility—with a caveat. Under the new law, home equity loans and lines of credit are no longer tax-deductible. However, the interest on HELOC money used for capital improvements to a home is still tax-deductible, as long as it falls within the home loan debt limit
If you take out a home equity loan, your interest payments may qualify for a deduction in addition to your mortgage interest. Beginning in 2018, only the amount that is used to buy, build, or improve your home qualifies for the interest deduction.
If you use a HELOC for home improvement, you may still be able to deduct the interest.
HELOC money used for anything other than improving your residence — such as paying down debt — is no longer tax-deductible, but that doesn't mean that a HELOC isn’t a valuable tool.
The limit on deductible interest for your mortgage is now $750,000 of indebtedness for tax years 2018 through 2025. However, if your loan originated before December, 15, 2017, you will still be able to deduct the interest on up to $1 million of indebtedness.
Turbo Tax will not allow me to enter the beginning principal balance on either my first or second mortgage. I deleted 1098, (major hassle), tried again, and still will not work.
Here's how to edit your beginning principal balance:
- Click on Federal > Deductions & Credits
- In the Your Home section, click on the Start/Revisit box next to Mortgage Interest, Refinancing, and Insurance (Form 1098).
- On the screen, Here's your 1098 info, click Edit next to your mortgage.
- Continue through the screens until you reach Tell us about your loan balances.
- Go to Original Loan Balance and the Balance on January 1, 2020 and
You'll be able to enter/check your entries for your beginning mortgage principal balance.
In Home and Business
Deductions and Credits
Your Home - Property taxes, mortgage interest, home refinance, energy improvements
Mortgage Interest, Refinancing, and Insurance - Select Start or Update
You will get to this screen to enter your outstanding mortgage principal from Box 2
I am having the same issue with a home equity loan. I deleted the 1098 and entered again, but it is not working. When I initially enter the information on the guided step by step process, it will not allow me to enter zero as the outstanding mortgage balance, so I have to exit out to the next section. Then on the review, it shows two errors. One is that I need to enter the mortgage balance and the worksheet allows me to enter the balance as zero and the pay off date. The second error is that I have to enter beginning balance of the loan and the field is highlighted, but it will not allow any data to be entered.
The instructions state that multiple 1098s should be combined, which I did for my primary loan, as I refinanced this year. Should I also add this loan to those? So add all three 1098s (two primary mortgage and one home equity loan) together and enter once? Please let me know how to move forward.
Ideally, you should combine the 1098's that are for refinancing and enter the HELOC separately. Delete the form that will not let you enter data in one field and then add the 1098 for the HELOC credit again using $0 or $1 for the beginning balance.
If the problem with the HELOC 1098 continues, it is fine to add it to the other two 1098's and enter as one entry.. The problem with doing that is that TurboTax will ask if this is a refinance or a HELOC.
Combining the entries means that you can not truly answer that question accurately. If you do combine the three 1098's enter the question as mortgage loan that I refinanced. Then answer the question about pulling cash from the loan when refinancing.
If you used the money from the HELOC for something other than to buy, improve or build the home it is secured by then you will need to enter that amount and it will not be part of the interest deduction.
[edited3/28/2021 | 4:16 pm PST]
Thanks for your response, but I am not sure how best to move forward. It seems there is an error in the program, because it will not allow me to enter the beginning balance of the loan on the form. I tried deleting and entering again (twice), but it still does not allow me to enter the amount. It seems the best way forward is to leave that blank, as it would be more inaccurate to combine with my other loan. I did not use the home equity loan to purchase or improve the home, so I won't get the tax break, while my primary loan does give a tax break. Would it be an issue to leave the beginning balance of the loan blank on the form?
No. It should not be an issue to leave the beginning balance blank. And yes, there is a known problem with Home Mortgage Deduction. TurboTax is working to fix the problem and the many other issues. There are many changes due to the CARES Act that require software upgrades. We have not been given an expected date for the fix yet. Please check back often to see if you can file your return.
Just be sure that your mortgage interest shown on the return is the amount you expect to deduct.
I am unable to file my taxes. Turbo Tax runs a last check before filing and will not move forward as the beginning balance for my Home Equity account is blank, but I am unable to enter any information in this field. How can I get assistance with this?
You will need to perform the following steps to record this.
- open Turbo Tax
- Go to federal>deductions and credits>
Your Home>Mortgage Interest and Refinancing (Form 1098)
You should see a page that says Home loan Deduction Summary
Edit next to the 1098 that reports your Home Equity information.
in Box 2, put $1.
If this doesn't work for you, let me know.
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