Can't transmit returns until multiple mortgage form is updated

[PC56514]

I have 4 1098 forms entered on my 2021 return (all for the same house) and TurboTax won't let me transmit as it says it needs updated form for situations with "multiple loans and limited interest", and this form is expected "after 2/17". Anyone seen this before and have an idea when I can expect this form to be updated? I was otherwise ready to transmit on 2/5. 

[AliciaP1 · Accepted solution]

Under tax law, you're 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. 

If you received multiple 1098s because of a refinance or your loan was sold to another lender, you can add them together to enter as 1 1098.  If you have multiple mortgages on the same property, as in a 1st mortgage and a HELOC, the different loans need to be entered as separate 1098s.

Follow these steps to enter your mortgage info as a combined 1098:

1. Gather all of your 1098 forms related to your refinance (the form from your original lender and the form from your new lender).
2. Grab a calculator and add together the box 1 amount from each form. Enter the total in TurboTax as Box 1 Mortgage interest.
3. Add the Box 5 amount from each form and enter the total as Box 5 Mortgage insurance premiums. (If you weren’t required to pay mortgage insurance, these boxes will be blank on your forms and you won’t enter anything.)
4. Add the property tax paid from each form and enter it in the Property (real estate) taxes box.

Next, finish adding info for boxes 2, 3, 7, and 11 using Form 1098 for the original loan.

[PC56514]

This started out 2021 as a first mortgage and home equity loan situation (not a HELOC), which we refinanced to a first and HELOC. Then the home was sold later in 2021. So I have all four 1098 separately entered. 

[AliciaP1]

The first mortgage 1098s should be added together and entered by the steps above and the home equity 1098s should be added together and entered by the steps above.  You should have 2 1098s on your return and if your combined home debt is under $750,000 for married filing jointly and $375,000 for married filing separately, you should be able to proceed without the worksheet.

[PC56514]

That worked! 

Thanks very much

[TroyC]

I am having the same issue, but I sold my old home in November. I bought my new home and paid the first installment at the end of December (due Jan 1). Have I entered something wrong or do I have to wait for the form update?

[DawnC]

You probably need to wait for the worksheet.   You should have 2 1098 forms on your return because you are reporting interest on 2 different homes, one you sold and one you purchased in 2021.   If the total debt for both properties exceeds $750k, you have to use the worksheet in order to determine the correct amount of deductible mortgage interest, as it may be limited.  The worksheet prorates the total interest to the allowed debt.  

In addition to itemizing, these conditions must be met for mortgage interest to be deductible:

• The loan is secured, which means the lender has some kind of guarantee of payment, usually in the form of property. If a borrower defaults on payments, the lender can seize the property that’s securing the loan. If you’re buying or refinancing a home, especially if it’s your first home, the loan is usually secured by the home you’re buying or refinancing.
• The home with the secured loan must have sleeping, cooking, and toilet facilities.
• The debt can’t exceed $750,000 (or $1,000,000 if the loan was taken before December 16, 2017) to get the full deduction.
• You or someone on your tax return must have signed or co-signed the loan.
• If you rented out the home, you must have used the home more than 14 days during the tax year or 10% of the number of days you rented it out, whichever is greater.

@TroyC

[TroyC]

Thanks, the total debt for both housed does exceed $750k ($279K + $673K). All of the other conditions are met; loan secured, second person on the loan (wife), debt is under $750K on new home, we did not rent out the home we live here and it has cooking, sleeping and toilet facilities. It is definitely after 2/17, do you know when the form will be available? I have been waiting for over two weeks to push the send button.

[AnnetteB6]

Take a look at the following TurboTax help article regarding your situation.  Click the link in the article to register your email and be notified with updates.

Why isn't my Deductible Mortgage Interest Worksheet available yet? 

@TroyC