Mortgage Deduction-Married Filing Separately and R...
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VAJOHN
New Member

Mortgage Deduction-Married Filing Separately and Refi

I file Married Filing Separately. When I enter the information from the 1098s for two mortgages refinanced in 2020 and the current mortgage, do I enter only the share of the mortgage and mortgage interest that apply to me? So for example, if my total new mortgage was $600,000, would I enter $300,000 for the mortgage amount if my wife and I are sharing the mortgage interest equally, then enter half of the total interest payments? If I don't, then my interest deduction is being limited. Also, do I seem to have to use the worksheet and override the number of months each of my mortgages was applicable for 2020, the first two for one month and the new one for 11, then manually recalculate the average mortgage for each of the three. This doesn't seem like I shouldn't have to do this but can't find another way. Anyone else having similar experiences and/or solutions?

 

3 Replies
AmyC
Employee Tax Expert

Mortgage Deduction-Married Filing Separately and Refi

MFS, you must both itemize or neither. If you are in a community property state, you will split things in half. If you are not in a community property state, you can choose who takes how much. The community property states are: AZ, CA,ID, LA, NV, NM, TX, WA, WI

 

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VAJOHN
New Member

Mortgage Deduction-Married Filing Separately and Refi

I know that if one files MFS the other has to as well. I know we can allocate the share we pay in interest in whatever proportion we agree (we will do 50/50 this year as we both contribute equally to the mortgage payment). The total mortgage owed by my wife and me is less than $600,000. The software is insisting that my mortgage exceeds the $375,000 limit ($750,000 per couple). The question it asks is what is the amount in box 1. But putting the full amount puts me over the limit.  So the questions is, do I only report half the mortgage as mine? We also refinanced in 2020. I am not sure, but I think it may be adding both the old and new mortgages in reaching the conclusion that I am over the $375,000 limit. 

DianeW777
Expert Alumni

Mortgage Deduction-Married Filing Separately and Refi

Thank you for bringing this to our attention. We are aware of this experience. Please sign up for email notifications when an update related to this issue is available here.

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