Refinanced / transferred mortgage showing as 4x the mortgage debt I actually have! How do I fix this?

[CCap]

Thank you!!

[cmommasurf]

I am having the same exact issue and have tried EVERYTHING suggested on this post and others. I even spent an hour on the phone with a TT rep. It still isn't fixed and is showing my mortgage as double what it should be. Please help. 

[KrisD15]

The amount of your loan balance on the worksheet does not matter. That is only part of the program and is not transmitted to the IRS with your tax file. 

If your daily balance is different than what shows on the worksheet, you may need to do some calculations. There are instructions for how to do that embedded into the software. 

Then, enter the amount of interest that you can claim on the adjustment screen. 

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

[Snowkid]

Does this imply that the whole process of entering the details from the 1098s, and dealing with TT inconsistencies with IRS forms, is essentially irrelevant, since the only thing that matters is your manual calculation of the limitation amount anyway? I've been fighting with the 1098 forms in TT for days, and even spent an hour on the phone with a CPA that works with Intuit... and the worksheets still don't have correct amounts on them... but the limitation calculations are correct, since I did them manually in TT.

[ethanbrady]

Did anyone solve this issue yet?? I have mostly figured it the Federal so that it reports it properly, but the State form insists on adding the 2 refinanced loans as if they were one larger loan over 1 million, thereby reducing my State mortgage interest by $1100. I have not found a way to change it yet.

[Meeeeechele]

I spent 2 hours on the phone with TT the other day, and I still haven't resolved the issue.  

[AlanT222]

Some TurboTax customers are experiencing an issue with their Home Mortgage Average Balance. This can cause the Home Mortgage Interest to be incorrectly limited.

If you're experiencing the issue above, please go here to receive email notifications when any updates related to this issue become available.

[jlbrick]

See discussion here: https://ttlc.intuit.com/community/tax-credits-deductions/discussion/bug-with-refinance-on-a-large-mo...

[JoannaB2]

Yes, you may claim mortgage interest deduction regardless of the number of lenders as long as the loan does not exceed $750,000 for married filing joint ($375,000 for married filing separately). The home mortgage loan must be secured by the property to qualify for the deduction. The following are steps to enter deductible home mortgage interest:

1. Login to Turbo Tax.
2. Under Federal Taxes, in Deduction and Credit tab, click "I'll choose what I work on".
3. Under " Your 2020 Deduction and Credit", click update or start next to Mortgage Interest, Refinancing, and Insurance.
4. Under " Home Loan deduction summary" click edit  and enter the lender's information, one at a time.
5. Click continue until you get to the screen " Is this loan secured by a property of yours?" 
6. Click Done.
7. The next screen is a question " Do any of the situation apply to you?". 

See, why is my home mortgage, if any issues encountered.