TT is ignoring my mortgage interest and forcing me to take the standard deduction. Is this a glitch in the software? How can I override this and itemize deductions?

[Critter-3]

YES ... that would make a big difference.   If the solar credit zero's out your income without itemizing then the program defaults to the standard deduction BECAUSE  if you itemize then the state refund you deduct on the 2022 Sch A is considered taxable income on the 2023 return ... so the program stops this unfortunate side affect of itemizing. 

[HopeS]

No, the energy credit will not impact your itemized deductions. If you meet the requirement of these tax credits, you typically can claim them on your tax return subject to certain limitations. This tax credit directly reduces your tax. For example, if you owe $1,000 in federal taxes but are eligible to claim a $1,000 tax credit, your net tax liability drops to zero. However, the credit is non-refundable credits meaning that they can lower your taxes but won’t result in a refund. You may have the opportunity to roll over unused portions of tax credits to future years, allowing you to use them to reduce your future tax liability.

Please be aware of the following limitations with your itemized deductions:

Please remember the IRS limits your state, local tax, sales, and property taxes deduction to $10,000. Therefore, regardless of the amount actually paid, you can only deduct a maximum of $10,000 for itemized deduction.

If you refinanced your mortgage and used any amount for something else than your home then you won't be able to deduct the interest for that part.

Please go back to the mortgage entry and review the questions after the Form 1098 entry carefully:

1. Login to your TurboTax Account
2. Click on the Search box on the top and type “1098”
3. Click on “Jump to 1098”
4. Click "Edit" to review your 1098 entry and questions.

Please pay special attention to the questions Is this loan secured by a property of yours? and Is this loan a home equity line of credit or a loan you've ever refinanced? since the answers to these questions can disqualify you from the mortgage interest deduction.

Please be aware, these conditions must be met for mortgage interest to be deductible:

• The loan is secured, which means the lender has some kind of guarantee of payment, usually in the form of property. If a borrower defaults on payments, the lender can seize the property that’s securing the loan. If you’re buying or refinancing a home, especially if it’s your first home, the loan is usually secured by the home you’re buying or refinancing.

For tax years 2018 through 2025, you can only deduct the interest from the amount of your loan that was used to buy, build, or improve the home that it’s secured by. If you’ve ever used part of this loan to pay for things other than this home, you cannot deduct the interest from that amount of the loan, even if the transaction didn’t take place this year.

• The home with the secured loan must have sleeping, cooking, and toilet facilities.
• The debt can’t exceed $750,000 (or $1,000,000 if the loan was taken before December 16, 2017) in order to get the full deduction.
• You or someone on your tax return must have signed or co-signed the loan.
• If you rented out the home, you must have used the home more than 14 days during the tax year or 10% of the number of days you rented it out, whichever is greater.

@jpardee81

[VolvoGirl]

If it's giving you the Standard Deduction and not showing you Schedule A you can check the actual amount of itemized deductions by using by going to

Tax Tools on left

Tools - Topic Search (top left box)

Type in itemized deductions, choosing. It should highlight that in the list, click on GO

Then Click on "Change my deduction". That will display the actual amount of itemized deductions vs. the standard deduction. (Be sure to uncheck "Change my deduction" after checking it so you do not lock in the wrong deduction.

@Critter-3  Is the program that smart to give you the SD when itemized are not needed?

[akty]

Same here. My itemized are about $11,000 more than standard deduction. I am also taking a solar credit. It shouldn't make a difference. Even when it breaks down the itemized deductions on screen and shows a higher amount, it still says the refund amount is the same as with the standard.

[akty]

I talked to a CPA friend and he explained that the solar credit was more than my tax liability for the year so the remaining credit will roll over to next year. It shows up as a credit carryforward to 2023 on line 16 of Form 5695. You can't see the forms until you pay to file. And you need to make sure you remember to claim it on next year's return. So that is why the refund amount for the standard deduction and the itemized deduction was the same.

[Critter-3]

@VolvoGirl 

 Is the program that smart to give you the SD when itemized are not needed?

Yes for a couple of good reasons ... the first is that the state refund is not taxable next year if you don't itemize this year  and   the IRS can question/audit  itemized deductions but can never question the standard deduction. 

This is the same philosophy I use for the HOH  vs  Single  argument ... if you get the same result with Single as you do with HOH then why give the IRS an opportunity to audit you ?   They can question HOH but not single filing status.