Re: Mortgage Interest Limitation not correctly calculating

labruin78 · Feb 13, 2021 8:47:33 PM

I am married filing jointly. We had one home mortgage that was outstanding all year long with a balance of approximately $500k - all interest should be deductible as this balance is below the $750,000 limit. I then purchased a new home and moved in September 2020 (but the previous home did not sell until January 2021). While this mortgage pushes us above the $750,000 limit, some portion of the interest should be deductible *increasing* our deductions. However, when I input both 1098 forms, TurboTax actually tells me that I can only deduct a total of about half of the interest just on the first mortgage that was below the $750,000 limit whole year. I think it should be allowing the deduction of the interest on the $500,000 loan, *plus* a portion of the loan on the new house (basically the interest on $250,000 of that loan before we reach the cap).