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Cruzesa
Level 3

Why is Acquisition Interest less than Actual Mortgage Interest paid?

On my Home Interest Worksheet, I stated that I paid $829 in interest, as reported on my Form 1098, but it is only taking $818 of that as deductible interest. What happened to the other $11?

9 Replies
JamesG1
Employee Tax Expert

Why is Acquisition Interest less than Actual Mortgage Interest paid?

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.

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Cruzesa
Level 3

Why is Acquisition Interest less than Actual Mortgage Interest paid?

Thank you, but how do I correct this if the system is not fixed before I'm ready to submit my taxes?

Opus 17
Level 15

Why is Acquisition Interest less than Actual Mortgage Interest paid?

Is part of your mortgage balance a home equity loan not used to improve your home?  Interest is only deductible on acquisition debt — debt used to buy, build, or substantially renovate your home.  If part of your mortgage balance was used for other things, then part of the interest is not qualified for the deduction.  

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*
Cruzesa
Level 3

Why is Acquisition Interest less than Actual Mortgage Interest paid?

I have a separate Home equity loan. The interest that is being reduced is not associated with the Home Equity, but with the 1st mortgage where no cash was taken for other than closing costs.

Opus 17
Level 15

Why is Acquisition Interest less than Actual Mortgage Interest paid?


@JamesG1 wrote:

 

 

Please sign up for email notifications when an update related to this issue is available here.

 

See also this TurboTax Help.


I suspect that posting the direct link to the signup page won't work since it won't be linked to this customer's problem unless they get their own link through the article. 

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*
Opus 17
Level 15

Why is Acquisition Interest less than Actual Mortgage Interest paid?


@Cruzesa wrote:

I have a separate Home equity loan. The interest that is being reduced is not associated with the Home Equity, but with the 1st mortgage where no cash was taken for other than closing costs.


You may want to delete the 1098 and enter it again.  The bug I know about involves a mortgage refinance, where adding 2 1098s for different lenders makes it look like your overall mortgage balance for the year was more than the cutoff of $750,000 even if each loan was less.  I don't think that is the problem you are having, with only $800 of interest in total.  

 

If the problem re-occurs, you can go to the help menu and select "send file to agent." That sends an anonymous version of your file to tech support and gives you a token number.  Post the token number here so I can refer it for investigation. 

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*
Cruzesa
Level 3

Why is Acquisition Interest less than Actual Mortgage Interest paid?

Thank you, Opus 17. I did delete all the 1098s and reentered the information. Now it is double counting the interest on the primary mortgage, which I refinanced during 2020, so I have 2 1098s for the 1st mortgage. It is counting the interest in both the "with 1098" and "no 1098" lines on the worksheet. Jeeesh!! Why can't TT get this straightened out??

Opus 17
Level 15

Why is Acquisition Interest less than Actual Mortgage Interest paid?


@Cruzesa wrote:

Thank you, Opus 17. I did delete all the 1098s and reentered the information. Now it is double counting the interest on the primary mortgage, which I refinanced during 2020, so I have 2 1098s for the 1st mortgage. It is counting the interest in both the "with 1098" and "no 1098" lines on the worksheet. Jeeesh!! Why can't TT get this straightened out??


Troubleshooting Turbotax online is very difficult because you don't have access to the internal worksheets, and no one on this forum can see your file.  You may need to call customer support to have a support person clean up your file.  Or, you could clear and start over. 

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*
Cruzesa
Level 3

Why is Acquisition Interest less than Actual Mortgage Interest paid?

I did send the document to an agent. The Token # is 726545.

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