The breakdown of my itemized deductions does not include the mortgage interest paid on my 1098s which is why the standard deduction is more than my itemized- why is it not taking my mortgage interest into account?
Due to refinancing we had three 1098s from the mortgage company. Turns out TurboTax wanted all of the numbers added together and reported as one line/1098....our mortgage interest was included as an itemization after doing that!
Yes, that is correct. Since these were all from the refinance company, These can be added together. if you do this, make sure that you have an average mortgage balance entered between the three 1098's listed on Box 2 incase in the mortgage balance changed in any of the refinances.
Without seeing your return, we can't tell why TurboTax calculated that it is better for you to take the standard deduction. If your total itemized deductions are higher, then it would have chosen itemized for you. However you can change from standard deduction to itemized.
TurboTax automatically selects the deduction that gives you the best outcome on your federal taxes. Most 2020 federal tax filers will be better off with the standard deduction versus the itemized deduction.
You can always switch to a different deduction. However, if you and your spouse are filing separate federal returns, both of you must take the same deduction per IRS rules.
Tip: It's best to hold off on switching until after you've finished going through the Deductions & Credits section. That way you can get an accurate picture of how both deductions affect your bottom line. Also, keep in mind that switching to the other federal deduction may impact your state tax return.
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Related Information:
Due to refinancing we had three 1098s from the mortgage company. Turns out TurboTax wanted all of the numbers added together and reported as one line/1098....our mortgage interest was included as an itemization after doing that!
Yes, that is correct. Since these were all from the refinance company, These can be added together. if you do this, make sure that you have an average mortgage balance entered between the three 1098's listed on Box 2 incase in the mortgage balance changed in any of the refinances.