THIS ANSWER IS FOR TAX YEAR 2018
PLEASE SEE BELOW FOR NEW ANSWER FOR TAX YEAR 2019
If you have a 2018 origination date in box 3 (and you should if you had no balance on 01.01.2018) you can move forward in the program. Leave box 2 blank.
The program won't like box 2 blank, but once you enter a 2018 date in box 3 and click continue, you can move forward and the error is cleared.
Just started using T-Tax Deluxe 2019 for Mac and had this issue come up. Solution posted previously does not work. Regardless of loan origination date entered, program will not let me move past this form. Have tried putting .01 in for balance and that doesn't work. If I put in $1 for outstanding balance, it allows me to move on BUT the loan is paid off and balance is actually zero.
I have the same problem. My 1098 for 2019 shows a zero balance in box 2 and I have interest to report. Turbo Tax won't allow me to enter a zero balance in box 2. Not sure what to do...............
If using the standard deduction, maybe I don't need to worry about entering the 1098??
FOR TAX YEAR 2019:
If this is a new loan and the Lender left Box 2 blank, enter the amount of the loan on the first day in 2019 when you acquired it.
If the box shows zero (0) you can enter zero(0). Do NOT leave box 2 blank.
The IRS has changed the 1098 this year and looks like it might change again for 2020.
For tax year 2019, Box 2 reports the loan balance as of 01-01-2019 HOWEVER if this is a new loan, enter the beginning balance of the loan.
According to the IRS:
"Enter the amount of outstanding principal on the mortgage as of January 1, 2019. If you originated the mortgage in 2019, enter the mortgage principal as of the date of origination. If you acquired the mortgage in 2019, enter the outstanding mortgage principal as of the date of acquisition."
My mortgage interest statement says 0.00 for Box 2 but I definitely have a balance, as I've only had the 30 year mortgage for 5 years! I don't know if I'm supposed to actually enter 0 or if I need to enter the amount of my loan balance as of 1/1/19.
Box 2 of form 1098 indicates the outstanding principal as of January 1, 2019. If this amount is 0 on your form, you can verify the amount by looking at your January 2019 mortgage bill. Another option would be to contact your lender if you think the amount shown in Box 2 of Form 1098 is incorrect. Is it possible that your mortgage was sold to another company or you refinanced? This may explain why Box 2 shows 0 on your form.
My outstanding mortgage principal is LEGITIMATELY $0.00. I paid off my mortgage in 2019 and have some mortgage interest to report. It doesn't let me go on.
Sometimes when you change the amount to $1 then you will no longer receive the error and it will not affect your taxes.
Here I am 1 year later and have the same problem. They still haven't fixed this! Once again, I paid off a mortgage in 2020, received the 1098 with interest to report but the mortgage balance is zero because the loan is paid off. Turbotax will not let me leave the entry blank or enter an amount less than $1. Why don't they fix this?
There are times when the program requires an entry other than "0", even when "0" is the appropriate value for that field. Using "$1" in these cases will not affect on any tax calculation or your ability to efile, but it will "tell" the program that you have made an entry required to support a deduction or credit.
In this case, entering "$1" for both the beginning year loan balance and the year-end loan balance lets the program know that you didn't forget to report at least some level of debt that would account for an interest expense deduction.
From an economic perspective, it accurately reflects that you owed the same amount (virtually nothing) at both the beginning and the end of the year.