I have refinanced twice for my primary home in 2019 and principal amount was around $500K each time. In total I received two 1098 form of mortgage interests total about $20k.
Earlier I had no problem entered the info and saw the deduction, later on after I ran the smart check, turbotax required me to enter 'LImit /int points on 1098' with error 'Tax and interest deduction worksheet: limited interests and points must be entered' and I was confused and entered '0', which made my mortgage interests no longer deducted from the application. I have tried removing all 1098 forms and re-entered again but it didn't help.
I have followed the steps to entered my 1098.
Any idea how can I fix this?
Thanks in advance!
You need to delete the Tax and Interest worksheet.
I am using MacOS premier version there is no tax tools in the top menu of turbotax. I saw an option 'Remove form' under tab 'Forms' but it's grayed out. Any idea how can I do it in Mac?
I am having the same issue. I used the FORMS on the left side of the ribbon and deleted all the mortgage deductions, added all the information again but am facing the same problem.
This solved the problem:
Solution: In Forms View, go to "Tax & Int Wks" and scroll down to "Mortgage Interest Limited Smart Worksheet". Assuming it's correct for your situation, change "Does your mortgage interest need to be limited" from Yes to No.
wow. thank you for figuring it out. I almost gonna redo it from scratch again
Can you please describe how to get to the forms view to check no? I can see how to delete a form but I cannot see how to navigate to a specific form to manipulate the information.
@FFFFFFFFFF wrote:
Can you please describe how to get to the forms view to check no? I can see how to delete a form but I cannot see how to navigate to a specific form to manipulate the information.
The form mode is only available on the CD/download desktop version installed on a Mac or Windows computer.
https://ttlc.intuit.com/community/using-turbotax/help/what-is-forms-mode/01/25900
When TT does the error check it pops up the form worksheet that has the error. If you read it you will see the limited question and that the 'yes' box is checked. Right there on that screen is where I checked the 'No' box.
Hope that helps.
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
Your suggestion is to answer "yes, one or both of these situations apply to me" but those situations don't apply to me. So, are you recommending that I still answer yes?
As you say, those situations DON'T apply to you. I understand and applaud your concern for truthfulness.
I am not a programmer, I'm a tax professional and I am here to give tax advice and help people get through any snags within the software.
You have the option of deleting the 1098's and re-entering them. When you get to the screen about adjusting the interest, don't enter zero, enter the amount of interest allowed. OR you can enter Yes and you will get to a screen where you can adjust the interest to the full amount allowed.
Please be assured that your "Yes" answer would not be entered on any tax documents, it is only for the TurboTax worksheets. It is a "Work-around" to get the right number on your return.
The tax laws concerning Home Mortgage Interest changed with the Tax Cuts and Jobs Act starting with tax year 2018. Because of this, the 1098 does not provide all the information needed to determine if the interest needs to be limited. Additionally, the reporting instructions for the 1098 change in 2018 and then again in 2019 and not all lenders adapted. I have played with the TurboTax program and would re-word that screen if it were up to me to say "We're not sure if your interest should be limited" but it isn't up to me.
IF the lender reported the 1098 properly, AND you answer all the interview questions correctly, the program should compute the interest properly.
If not, answering "Yes" will get you where you need to be in the program and will not alter any tax forms.
I hope this helps, and thank you for using TurboTax.
Thanks so much for this solution, OMG! Are you kidding?!! WTF??? The only thing that I would add is that there was no 1098 entry in my forms list, even though I'd entered the data. I made them (and had 5! this year due to 3 refis and my broker selling the loan each time) using the "open forms", and then linking to the "worksheets" (also not in the list), but from there could also create a form. It was maddening. I mention it only because I'm not sure if the "Tax & Int Wks" sheet was even there before I did that, because I found this post after I spent 2 hours creating and recreating 1098 worksheets and forms (which didn't change the tax at all)... and then all I had to do was find the goldmine of a post and link to that obscure"Tax & Int Wks" form and change the checkbox?? Your description is exactly what happened to me. I got an error. Entered '0' in the box, and boom $7K of tax was added. Unbelievable, really. No way to take that zero back! Without this post, I'd still be searching. With that little checkbox, we got our $7K back!! I will definitely let turbotax help/support know if they EVER call me back. Their number is [phone number removed] if you're looking for it, but you may need to navigate their system to put in a request for help and get a case # (I did that and they recognized my phone number and associated it with the help request). Sorry for the long post, but a turbotax FU in the 1098 is kind of hard to believe. BTW, also using MacOS Premier.
I just had this issue, I called turbotax today and the person I spoke with was able to ask a few of their coworkers as well.
For my particular situation I had three 1098's. I was unable to unselect things as I was on the website and not using the desktop program.
I put the exact same amount that was showing in the first box (line one asking for sum of numbers from line 5a-5d, right above the box where it was asking you to input number for Sch A, 8A), and it allowed me to continue without changing any numbers on my return.
Hopefully this helps others as well!
You can not change answer from yes to no on the online version of turbo tax, it simply does not have forms view. According to IRS on line 8a mortgage interest and points reported to you on Form 1098 should be entered unless one or more of the limits on home mortgage interest apply to you.
There is a software bug when you have multiple 1098s, see the discussion at https://ttlc.intuit.com/community/tax-credits-deductions/discussion/bug-with-refinance-on-a-large-mortgage/00/1820267/highlight/false
The issue has been submitted and is currently under investigation. Please click on the following link and sign up for an email notification when it's fixed.
Limited interest and points must be entered
Thank You for your patience.
Note that your mortgage interest and property tax might not change your total tax refund. It will only change if your total itemized deductions exceeds your standard deduction. In the TurboTax program, when you enter itemized deductions such as mortgage interest, property taxes, medical expenses, charitable contributions, all of these items are added together. Unless the total of itemized deductions exceeds the standard deduction for your filing status, you would not see any change in tax due or refund. You should receive a Form 1098 which reflects the mortgage interest, points or property taxes you actually paid.
I closed on my home in June 2019. It was held by Roundtree Mortgage until October 2020, then sold in October 2020 to Freedom Mortgage. I now have two 1098's to enter with taxes and interest on both. Intuit is asking to enter limited points/interest. After searching forums I decided to enter the same total amount into the box which seemed like a workaround. Completed the review and everything was good.
Woke up today and Intuit reviewed my file again, came back with two new requests. It now wants me to enter the loan balance as of Jan 1, 2021 and the date when I paid off the loan - for each 1098...
This seems like an error as I didn't pay off or buy my home. Is there a fix for this?
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 here.
See also this TurboTax Help.
thanks for suggestion.. i have same error and can not e file. sorry but where is the Forms view??? i asked turbo tax help and they had no idea using TT premier?
If you are using Mac OS you can enter 'form view' by clicking 'form' from top left corner.
Hi, I'm having the same problem as you've helped solve here (limit int/points on 1098), but i'm unable to check the "No" box after the question: "Does you mortgage interest need to be limited?". When I click on the "No" box it becomes highlighted, but the X doesn't move from the Yes box to the No box. I've installed the latest updates... any suggestions?? Thanks! -Gawain
I cannot 'uncheck' the 'yes' to a 'no' on the Mortgage Interest Limited Smart Worksheet.
hmmnn, any suggestions?
One of the other threads in this subject (I can't recall which one) suggested entering a "0" on one of the lines relating to mortgage interest (i wish i could be more specific here!). This allowed me to file. Good luck!
There is an entry somewhere that is causing the limitation and it is usually related to entering multiple forms 1098. Try working in the step-by-step mode. For the best results you'll need to delete all the 1098 entries and start fresh.
Follow these steps.
Be advised the mortgage worksheets are not part of the forms that are filed with the IRS. Follow these steps to correct/eliminate the limitation on your mortgage interest deduction:
If you need you can re-post with specific loan (1098) information.