My form 1098 has the outstanding mortgage principal but turbo tax is asking for the outstanding mortgage balance. What is the difference?

[ponder6168]

My form 1098 has the outstanding mortgage principal which I have entered where TurboTax asks for it but on the next page TurboTax asks for the outstanding mortgage balance. What is the difference?

[KrisD · Accepted solution]

Box 2 on the 1098 has the beginning balance, the next page asks for the ending balance. 

Box 2 is the outstanding mortgage balance on Jan 1, the next page asks for the outstanding mortgage balance as of Dec 31. 

The program is checking for an increase in the loan which would signal a Home Equity Line Of Credit. HELOC are treated differently starting this year. If the additional loan is used on the home, it is deductible. If it is used for a second home, or anything else, it isn't. 

[ceea220]

Our Box 2 figure is $5000.00 higher than the box 10 "ending principal balance" figure and we never took out a home equity loan.  Why would this be? Does it have to do with the fact that for a number of years  we had to pay Mortgage Insurance? We haven't in years, but I can't think of any other reason?

[SteveJ4]

My outstanding mortgage principal is 0 in box 2 because as of Jan 1 no money with withdrawn from the HELOC.  Do I need to put the year end balance amount in box 2 or leave it 0?  I cannot get past error message - Outstanding mortgage principal must have a value.

[juanelaube]

I have the same problem. My 1098 shows .00 in Box 2 Outstanding mortgage principal. Any idea what to enter there?

[PatriciaV]

@juanelaube

Enter the amount on the date you opened the mortgage, even if it's the same as the ending balance.

From the IRS Instructions for Form 1098:

Box 2. Outstanding Mortgage Principal - Enter the amount of outstanding principal on the mortgage as of January 1, of the current year. If you originated the mortgage in the current year, enter the mortgage principal as of the date of origination. If you acquired the mortgage in the current year, enter the outstanding mortgage principal as of the date of acquisition.