Issue with "Limited interest and points must be entered"

[Kizzzaaay76]

Hi - using the online version and this does not work for me.  Having same issue as everyone else has posted in here and still have not found a solution.  Please help. 

[JantovenNF]

@PMAK Same issue for me as well.  TurboTax is adding up our refinances and listing the total amount as opposed to the average outstanding mortgage.

So for us, we re-financed twice - a 370k loan two times.  Instead of TurboTax using the average of the mortgages (which should be around 365k), it has instead added all 3, and thus it is saying we had 1.1mil of mortgages, which leads to a significant chunk of our mortgage interest being phased out.

TurboTax had this issue last year and has stunningly not fixed it.  It would seem they are royally screwing over a lot of customers, as I imagine most probably don't even pay attention to the details and notice that they are getting a much smaller return than they should be.

[PMAK]

@JantovenNF They even ask if the loan is refinanced, which you would think would signify to their algorithm that the two loans listed are the same and shouldn’t be added together. The fact that it looks like this question has been going on for over a year now is not a good look for TurboTax. Been using them for 8 or 9 years without much of an issue, but this is strange.

[YetiBash]

@PMAK @JantovenNF I'm not sure it's a TurboTax issue - although I wouldn't let them off the hook as this is clearly a complication for their users, so they should at least address it.

Below are some screenshots from the forms view after I entered all of my information through the wizard. I've circled in red the important values. As you can see, based on the worksheet calculations, it is combining my original loan ($452k) and my refinanced loan ($451k) to come up with the limited deduction total ($902k). What I ended up doing was zeroing out the "Outstanding mortgage principal as of 12/31/2020" (Value E on Home Mortgage Interest Limitation Smart Worksheet") because, in fact, the outstanding mortgage principal as of 12/31/2020 on that loan was $0.00. This brought my limited deduction total into the $600k range.

Form - Home Mortgage Interest Limitation Smart Worksheet for Original Loan:

Form - Home Mortgage Interest Limitation Smart Worksheet for Refinanced Loan:

Form - Deductible Home Mortgage Interest Worksheet:

[JantovenNF]

@PMAK 

Same, I've used TurboTax for years and have been relatively happy with the product, but this is a rather egregious error, and the fact that it occurred last year and has continued into this year is a bad look for them for sure.

This absolutely has to get fixed.  It appears you can override the forms on the desktop, but there is no real work-around for the online version.  Even zeroing out the "mortgage balance" section leads to erroneous calculations on that one worksheet, with no ability to modify it.

[JantovenNF]

@YetiBash 

Thank you, Yeti, for sharing.  I noticed that putting in 0, while that helps, does still create a very inaccurate estimate for the average mortgage debt.  I re-financed twice and, thus, have triple the average.  I can zero out two of them, which I suppose helps solve the problem, but it still leads to a very inaccurate average.

If I have to do that, I will, but I just wish they could fix the software so that we can either do it correctly, or be allowed to manually override the average with our own calculated average, which would really solve the whole problem.  I know desktop users are able to do that currently.

[Ginas602]

How do you get to forms view to do this?

[JantovenNF]

@Ginas602 

I think forms view is only available in the desktop version, not on the online version.

[CaliforniaTaxed]

I'm dealing with this! We financed last year and now our online return is completely messed up. I can't find the "form view" fix online that was referenced as a fix from last year. This is SO annoying. FIX THIS INTUIT!

[Anonymous]

How do you get to the forms view? Can't find it anywhere.

[Malashaan]

I am also having this issue. As people have figured out, it's triggered by having refinanced my home loan in 2020. There needs to be a fix or official workaround to this. I'm using the online version and can't figure out any way to fix it.

Editing to add that the work around I used was to set the principal balance of the loan I took out this year to $0. That doesn't comply with TurboTax's instructions, but it makes logical sense as what matters for all other loans is the balance on Jan. 1, 2020. As long as you're not near the $750k limit for principal, it really doesn't matter - all that goes on the actual tax return is the amount of interest you paid. 

[hardcoded]

I'm facing this too and am at a standstill until it's fixed.  Please provide us with a solution for the online version Intuit!

[LinaJ2020]

The issue has been submitted and is currently under investigation.  Please click on the following link and sign up for an email notification when it's fixed.  

Limited interest and points must be entered

Thank You for your patience. 

Note that your mortgage interest and property tax might not change your total tax refund.  It will only change if your total itemized deductions exceeds your standard deduction.  In the TurboTax program, when you enter itemized deductions such as mortgage interest, property taxes, medical expenses, charitable contributions, all of these items are added together. Unless the total of itemized deductions exceeds the standard deduction for your filing status, you would not see any change in tax due or refund.  You should receive a Form 1098 which reflects the mortgage interest, points or property taxes you actually paid. 

[hardcoded]

@LinaJ2020 the link you gave says it is solved so I went in to do my taxes, cleared it all, typed everything back in and it is still there.  What is the ETA for this to be fixed?

[pegasus2010]

I am still experiencing this issue. Can you help me out?