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Returning Member
posted Feb 4, 2022 11:48:35 AM

Property tax deduction appears incorrect

I paid a little over $3,200 in property taxes according to my 1098. When I view my itemized deductions, TurboTax has deducted $10,000 (the max) for property taxes. Why is this happening? This seems like a bug, and one that could get me into trouble.

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1 Best answer
Level 15
Feb 4, 2022 12:00:15 PM

review schedule A. real estate taxes are on one line, state income taxes on another, etc. you may be looking at a combined total for all taxes. if schedule A shows $10,000 for real estate taxes, then go back to the 1098 to check the real estate tax amount and make sure you didn't enter real estate taxes somewhere else.

 

5 Replies
Level 15
Feb 4, 2022 11:52:54 AM

There are other taxes that count.  Like state withholding on your W2s and any 1099s.  And a state tax due you paid last year.  Any state estimates you paid it 2021.  All the taxes you paid are limited to 10,000 now.  Look at Schedule A to see what's being included.

Level 15
Feb 4, 2022 12:00:15 PM

review schedule A. real estate taxes are on one line, state income taxes on another, etc. you may be looking at a combined total for all taxes. if schedule A shows $10,000 for real estate taxes, then go back to the 1098 to check the real estate tax amount and make sure you didn't enter real estate taxes somewhere else.

 

Returning Member
Feb 4, 2022 12:07:59 PM

Thanks, everyone. I didn't notice that state and local taxes were included in the deductions breakdown (on the same line as property taxes no less), partly because I didn't realize they were deductible. Until now I've never been in a position where itemized deductions made more sense than standard, so I'd never seen the breakdown.

 

Schedule A looks correct. So we're good.

Level 15
Feb 4, 2022 12:14:37 PM

Surprising you have enough total deductions to itemize.  Usually it's the other way around now.  People can't itemize anymore because the Standard Deduction has increased a lot.  Did you have a lot of medical or something?  Did your income go down?  

Returning Member
Feb 4, 2022 12:16:47 PM

I've been fortunate. I bought a house last year (so mortgage interest is a factor now), and state income tax is higher than average where I live. State income tax plus property tax was greater than $10,000, and mortgage interest pushed it over the standard.