What is this tax and interest deduction worksheet
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New Member

What is this tax and interest deduction worksheet

 
9 Replies
Employee Tax Expert

What is this tax and interest deduction worksheet

The tax and interest deduction worksheet shows the itemized deductions claimed for state and local taxes, including real estate taxes, and mortgage interest. You would only itemize if your total deductions were greater than the standard deduction for your filing status. However, these deductions can still be listed on your return. The worksheet helps calculate the deductions and determine if the standard deduction or itemized create the best tax benefit for you.

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Level 1

What is this tax and interest deduction worksheet

Working on my taxes using the Turbo Tax Deluxe edition.  Done with everything and checking errors.  The program prompts me Check This Entry:  Tax and Interest Deduction Worksheet: Limited interest and points must be entered.

 Limit int/points on 1098 then there is a box for me to enter an amount.  It won't allow me to click the continue button until I enter an amount.  Not sure what amount I'm supposed to enter there.  I have multiple 1098 forms.  for my primary residence and for the vacation home.  HELP!

New Member

What is this tax and interest deduction worksheet

I have the same problem with mkpayne5754 , could anyone help?

New Member

What is this tax and interest deduction worksheet

Regarding the `Limited amount to report on Sch A, line 8a`, sometimes TurboTax won't auto fill it and fails the final check. I found it should be the same value as `Sum of lines 5a through 5d below` field above if your loan is not over the limits by IRS and the portion not being used towards the property are handled correctly. Otherwise you need to put the value accounting for limitations.

(Disclaimer: I'm not a tax professional. Take my opinion at risk.)

Expert Alumni

What is this tax and interest deduction worksheet

The amount of your mortgage interest and points may be limited if the amount of your outstanding mortgage loans are greater than $750,000 (if the loans were originated in 2018 or 2019) or $1,000,000 if the began before 2018.

 

This question about Enter your adjusted mortgage interest and points is because from  the information you entered your mortgage interest and points are limited due to being over the limit of $750,000 or the $1,000,000.

 

If this is the case then you need to 

First,  figure out what your average mortgage balance is. To do this:

  • Take the balance of your mortgage at the beginning of the year, and add it to the balance of your mortgage at the end of the year.
  • Divide this amount by 2 to get your average mortgage balance for the year.

Next, you need to compare your average mortgage balance with the limits above. If your average mortgage balance is greater than the limits, then do this:

  • Divide the limit by your average mortgage balance to get a percentage.
  • Multiply the percentage by how much mortgage interest you paid for the year. This will tell you how much total mortgage interest you can deduct.

If your average mortgage balance is less than the limits above, then you can deduct all of the mortgage interest that you paid this year.

Please note: You can only deduct the interest you paid on the amount of the loan used to buy, build, or improve the home the loan is secured by (meaning the property that acts as collateral for the loan).

 

If your loans are not more than the limits then you need to review the information you put in for your loans.

 

For box 2 of a refinance loan the amount should be $0 since the box is asking for the outstanding loan balance as of 01/01/2019.

 

@mkpayne5743

@dy5 

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New Member

What is this tax and interest deduction worksheet

No one has addressed my situation. I get the same error message. 

I have several refis on primary home mortgage and a vacation home purchased in Sep. 2019. But the Turbo Tax (Deluxe) Home Mortgage Interest Worksheet is calculating average balance for each refi as half of outstanding mortgage principal. If I calculate using other IRS methods, I am under the $750K limit. But TurboTax won't let me change the amount. Any help out there? Thanks.

 

Employee Tax Expert

What is this tax and interest deduction worksheet

Try the following:

  • Click on the View link on the top menu bar 
  • Click on Forms 
  • Locate and click on 'Tax & Int Wks' on the left-hand side of the screen (under Forms in My Return) 
  • On the form, scroll down to the 'Mortgage Interest Limited Smart Worksheet' 
  • Click on the 'No' box, to the right of the question 'Does your mortgage interest need to be limited.' 
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New Member

What is this tax and interest deduction worksheet

Need Help!

Employee Tax Expert

What is this tax and interest deduction worksheet

@Dizavian

Ready to help.  What is your question.  Please be specific.  Are you having an issue with the mortgage interest deduction?  

 

The tax and interest deduction worksheet is used if you are going to itemized deductions on a Form 1040 Schedule A.  

If it is not applicable to your situation you can delete the form by:

  1. Selecting Tax Tools in the left side menu
  2. Clicking Tools
  3. Under Other helpful links, selecting Delete a Form
  4. Scrolling down to the form or worksheet you would like to delete.
  5. Selecting Delete
  6. Clicking the Continue With My Return button

If your issue is more specific, please provide additional information about your situation so that we can help you.

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