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takhli72
New Member

Our mortgage is paid off

The balance of our mortgage was paid off to First Federal on 09-21-2016.
1 Best answer

Accepted Solutions
xmasbaby0
Level 15

Our mortgage is paid off

It must feel good to have your mortgage paid off.  You can deduct the interest you paid in 2016 prior to paying it off, and you can deduct property taxes paid in 2016.  Going forward, your only home ownership deduction will be property taxes.

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

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7 Replies
xmasbaby0
Level 15

Our mortgage is paid off

It must feel good to have your mortgage paid off.  You can deduct the interest you paid in 2016 prior to paying it off, and you can deduct property taxes paid in 2016.  Going forward, your only home ownership deduction will be property taxes.

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**
tonylima181
Level 1

Our mortgage is paid off

TurboTax won't let me enter 0.00 for the mortgage balance.  This is for the 2019 tax year.  Help!

DMarkM1
Expert Alumni

Our mortgage is paid off

Unless you refinanced or are trying to get the below the $750,000 limit of mortgage debt, then the ending balance is not a factor.  Just enter your form 1098 information and including property tax paid information to get your allowable deductions. Next year you will not have a 1098 to enter if you don't have any outstanding mortgage debt.  You will still be able to enter any property taxes paid.  

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frank47
New Member

Our mortgage is paid off

Turbotax does not accept 0.00 on the mortgage balance.  what do i do? this is holding up completing my return.

KrisD15
Expert Alumni

Our mortgage is paid off

Do not alter the 1098. Enter the 1098(s) as reported. Box 2 should not be blank. Box 2 is the balance of the loan on 01-01-2019 OR the balance on the day the loan was taken out in 2019. Answer the interview questions carefully.

If you get an error concerning the balance, please follow these directions:

ONLINE USERS:

Please go back to the Home Mortgage Interest section:

Click Federal on the left side-bar

Click Deductions & Credits along the top

Scroll down to “Mortgage Interest and Refinancing (Form 1098)” Click Edit/Add

Scroll down the “Here’s your 1098 info” screen and click Done.

Next screen asks “Do any of these situations apply to you?” Select “Yes, one or all of these situations apply to me.” and Continue.

On the following screen, you will see the “Original amount”.

Enter the amount you can claim as a Home Mortgage Interest deduction in the “Adjusted amount” box. The Adjusted amount cannot be larger than the original amount or you will receive an error when trying to file. Instructions on who needs to adjust interest and how to calculate are available by clicking the blue “Help me figure this out” link.

DESKTOP USERS:

Go into Forms (top right)
Enter the amount on Tax & Int Wks
Mortgage Interest Limited Smart Worksheet section
Line A2

OR

Step by Step

Federal

Deductions & Credits

Mortgage Interest, Refinancing and Insurance Click Update

Click Done

Click Yes, one or both of these situations apply to me. And Continue

Enter the Adjusted amount and Continue

 

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AC191
Level 2

Our mortgage is paid off

Paid off my mortgage in 2020.  TurboTax won't let me enter 0.00 for the mortgage balance on the 2020 tax year software. Also I did not get a 1098 because interest was less than $600 so bank did not send.  Please help me resolve how to record the interest and how to accept the 0 mortgage balance!

DawnC
Expert Alumni

Our mortgage is paid off

The bank will send a 1098 even if you paid less than $600 interest.  You may also be able to find the document online at your bank's website.  The question regarding the mortgage balance is asking the balance as of 01/01/2020, the beginning of 2020, not the end of 2020.   

 

Your outstanding mortgage principal balance (Box 2) is the amount of money you still owe on your home loan as of 01/01/2020.  If you paid off the mortgage during 2020, the 1098 will tell you the balance as of 01/01/20, which will not be 0.    @AC191

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