The desktop version has the bug of adding the mortgage principle together if I added the refinance loan. This is absolutely wrong and the issues has been ongoing for month! I will never use TT again for future. Please fix this **bleep** bug or REFUND me!
Your software really sucks
I apologize for your frustration. There is a workaround. Please try the following steps to rectify your input so you can proceed with your return.
The problem may occur if you have refinanced during the year, and the input reads your data as exceeding the $750,000 limit to be deductible.
If you are working in the Desktop version, you can try the following as provided by jmcglass.
it does work at all, yeah I can mark it as NO manually, but it does not change anything on how it calculates the mortgage principle total amount. Please fix this turbotax
On that screen, select "Yes" and then enter the full amount of interest you can claim on the screen that follows.
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
It is my understanding that the software programmers have been notified of what we have been hearing.
Issue still exists even on this day. This is a huge bug and has to be fixed right away.
I gave you a thanks in advance, anticipating it will work for me. I am not using the desktop version, however I am having the same issue. Thanks
Still a problem on the online version even now that it's 2021. This needs to be fixed. It's been going on for over a year and for 2 tax filing seasons.
Having the same issue as well. Notice that the issue is that TurboTax is ADDING the refi mortgage balances together instead of taking an average. This is causing the mortgage interest to be phased out for me, when it shouldn't be.
I re-fi'd a 370k mortgage twice (married filing separately). It registers my mortgage debt as over 1mil, when it was in fact never over 370k. I notice on the Home Deduction Worksheet, it adds the 3 mortgages together. The same issue is true for BOTH the federal and the California worksheets.
Doing a search on TurboTax's forums, it appears many people have had this issue, but TurboTax STILL hasn't resolved it, despite it going on for a year?
I got through to Intuit support. They did a screen sharing session with me. We watched as my refund shrunk by almost $10k when I added in the second 1098 from my refi loan. I pointed out in the worksheets that the principals are added rather than averaged. They called me back the next morning and admitted the bug, as well as the magnitude of it. They said the website would be updated in around 3 weeks (so mid Feb sometime). We'll see.
In the meantime, you can replace your multiple 1098s with a single, manually-entered one that sums the interest paid across the individual 1098s. Check the box that says "The interest amount I entered is different than what's on our 1098." You can then provide an explanation like "TurboTax has a known bug where multiple 1098s aren't calculated correctly. Workaround is to sum the interest paid into a single 1098." I'm told (but can't verify) that the IRS won't come after you as long as the values are right, even if the 1098s don't exactly match. Do so at your own risk. Hopefully this workaround will be moot in a few weeks anyway.
I am using the online version and this bug is STILL present for the 2020 tax return year. What do we do???
What a shame that we are to combine 1098s as one and enter "at our own risk". We all pay good money for this software, this bug should have been corrected for 2020, as I see it was a problem back in 2019. Do I trust that it will be fixed by mid-February? Nawww, but we'll see! If not, I'll be forced to go to a tax guy instead of risking an audit! It's either that or settle for the $3k less their software is shaving off my tax return. Why would I settle for $3k less?! :(
@rberman THANK YOU!!!! I was getting so frustrated reading all the "experts" that were just citing how it should work. Obviously, there are many of us having this issue. I appreciate that you took the time to call and do the screen share.
Thank you for providing this information. We are aware of this experience. Please sign up for email notification when an update related to this issue is available here.
hello
I am having the same issue, I called your customer support which at first appeared to be clueless then I was told there is nothing they could do about it.
Is there a fix expected before the end of the month or should I give up and go to a real CPA ?
thanks
This is a known error with TurboTax that is currently being worked on. See this link for more information.
Hello
I received an email today claiming this issue had been fixed however the solution outlined here does NOT work https://ttlc.intuit.com/community/entering-importing/help/how-do-i-handle-multiple-1098-mortgage-forms/00/26922
I refinanced my mortgage with the same lender and as soon as I enter the 2nd 1098 my taxed due increase. please advise.
How do I handle multiple 1098 mortgage forms?
If you have multiple 1098 mortgage forms, you’ll enter them one at a time. After going through the steps with the first one, you can add a lender when you get to the Mortgage deduction summary screen. (In the case of a refinance, it's best to enter the 1098 from your original loan before the 1098 from your refinance.)
But, if they're both from the same lender, and one of them has the “Corrected” checkbox marked at the top, enter the corrected 1098 and discard or shred the other one.
What do I do if I have multiple 1098s from refinancing my home debt?
If your total home debt is under $375,000 ($250,000 for married filing separate) there is nothing new for you to do in 2020. Enter each 1098 as you normally would.
Home Debt Over $375,000
Under tax law, you are limited on the amount of home interest you can deduct. The limit is based on the loan amount and date of the origination of debt. We want to make sure we calculate this correctly for you.
If you refinanced last year, you’ll have a Form 1098 from your previous lender and one from the lender you refinanced with. You’ll need both forms.
Follow these steps to enter your mortgage information:
Next, finish adding info for boxes 2, 3, 7, and 11 using Form 1098 for the original loan.
What if I have more than two 1098s?
You should combine all of the 1098s directly related to the refinance and enter it as one 1098. An example of this is if you refinanced two loans into one loan. Any 1098s not directly related to the refinance should get entered separately.
What if I paid points?
Points on Loans Paid Off in 2020: Enter the points on your 1098 you have started and mark you paid off the loan when promoted.
Points on Loans on New Loans: You will want to enter a separate 1098 to cover these points paid. When prompted, enter 0.00 for Boxes 1, 2, 5, and the Property (real estate) taxes box, and checkbox 7, as you’ve already entered the details on your first 1098. For Box 3, add the date in 2020 when the loan originated.
It seems this is a software bug that is unable to correctly handle refinance of Jumbo mortgages taken before Oct 2017.
If I read this correctly what you are suggesting is to report two 1098's (original and refi) as one 1098 by adding the interest values and using the original loan amount / origination date. Is this compliant with IRS guidelines i.e. reporting one 1098 while actually having received 2? what if you get audited ?
Although this workaround can correct the return value I can see how it will create problems going forward. next year the 1098 issued by the lender will have the refinance date in BOX 3. the software will then again cap the deduction amount to 750K limit not being able to account for the refinancing. How is this going to be handled and why can't turbo tax software simply fix this bug while correctly entering two 1098's?
thanks
Some TurboTax customers are experiencing an issue with their home mortgage average balance. This can cause the home mortgage interest to be incorrectly limited. This may be affecting your tax return.
Please sign up for email notifications when an update related to this issue is available.
See this TurboTax Help.
Same problem here, it is mid February and the problem is not fixed
This has been going on for years! I am glad I am not the only one super frustrated with Turbotax this year. I have spent way too much time with their glitches and having to find workarounds for their bad code! I too will be moving to another vendor next year. Enough is enough!
Anyway, I went in today and they suggest adding together all loans, which I have done. However, it is still picking up two loans and adding them together and then saying I am over the limit. I overrode the interest deduction to be the correct amount. It is only the Home Mortgage worksheet that shows the wrong amounts. I am hopeful that CA will understand TTs software issue and not hold up my refund. This year was rampant with refinances in CA.
It's my current understanding that Intuit is not ever planning to fix this bug. They closed my very long thread on the topic to further posts
I am waiting a few more days, if not fixed I will delete my account and move to a real CPA. it is frustrating