I bought my house in 2013, and in 2016 I refinanced and took cash out to pay off debt. Do I report the full amount shown on the mortgage interest statement from my lender, or do I take cash out/ refi amount and apply that percentage to the interest? So if it was a $175,000 mortgage and I refinanced for $200,000, would I take 87.50% times the mortgage interest I paid in 2019 to report on my taxes?
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When you enter the 1098, the program will ask if the loan was ever a HELC and if so, how much cash was taken out.
The program can make the calculation with that information.
It wasn't a HELC ever... Just a straight cash-out refi so we got a wire into our bank when the new mortgage closed, which we used to pay off debt. So do I need to calculate that percentage based on how much cash we took out when we refinanced?
No, you do not need to calculate the percentage of your mortgage interest that is deductible. As KrisD15 said above, TurboTax will calculate this for you based on your answers to the questions. Please follow these steps:
Please refer to this TurboTax Article for more information.
Where do I submit the refi info?
You enter your refi information in the Home mortgage section under Deductions & Credits.
Follow the instructions above to provide the necessary details of your loan.
If you are having trouble finding the Home mortgage section, use the search box in the upper right corner to search for "1098", then click Go to 1098.
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