TurboTax recommends significantly smaller itemized deduction over standard deduction

I would think the only reasons  TT said to do that was 1) you selected that option or 2) you are married filing separately and indicated that your spouse itemized on their return.    

Neither is true in this case. I'm filing married jointly, and each time I go to the final section of "Deduction & Credits" ("Wrap up tax breaks"), TurboTax will tell me the itemized deduction is right for me, even if I had already selected the standard deduction.

It is easy to switch from Itemized Deductions to Standard Deduction in TurboTax by following these steps:

1. While in your Tax Home,
2. Select Deductions & Credits from the tabs across the top of your screen,
3. Scroll down and select Wrap up Tax Breaks,
4. Continue through the Screens and Wrap up Tax Breaks again,
5. You will get this screen:

 

 

    6.  Next select whether you want to Itemize or use your standard deduction:

 

Thanks for the step-by-step guide, but it isn't addressing my question. I'm asserting that TurboTax could cost people thousands of dollars in tax credits by suggesting the wrong deduction. Am I wrong?

I encountered the same issue. Have you figured it out?  Should we select the higher amount of standard deduction? Are we getting long term benefit by doing this?

I can't speak to your specific scenario. In my case, I stuck with the the standard deduction over TurboTax's insistence on the itemized deduction because I know I'd rather roll over some of my AMT credit and pay thousands of dollars less tax next year than waste them all for a $47 break this year.

Thank you. I plan to do the same. The form 6251 and 8801 are so complex and I got lost. But I sensed that rolling over the credit makes more sense.