Mortage interest statement box 2

[billpeatross]

Why is home equity line loan Mortage Interest Statement form 1098 box 2 $0.00? According to bank statements, I still owed $68,000 as of 1/1/2018.

[NCperson]

check with your servicer...note that the form requires the balance on  the 1st day of 2018 

from the way you posed the question, were you really asking about 1/1/18 or 1/1/19?

the link below is the 2019 version of this form.....thus if you look at the instruction on page 4 for Box 2 it states to list the 1/1/19 balance which means the 2018 form would state to list the 1/1/18 balance 

https://www.irs.gov/pub/irs-pdf/f1098.pdf

[billpeatross]

Thanks. Box 2 on my 2018 Form 1098 (received from the bank in January 2019 for tax year 2018) reads, "Outstanding mortgage principal as of 1/1/2018". It has $0.00. But I know from bank statements that my outstanding principal on 1/1/2018 was $60,000. I am confused as to why it shows $0.00. It makes my tax due to IRS about $1000 more than if I enter the $68000 the was "correct" balance due.

[NCperson]

1) suggest calling your servicer and ask 'why'.

2) there are threads elsewhere on this website that there are bugs with certain versions of TT regarding the mortgage deductions.  Which method (CD / Download, App, Online) and version (premiere, deluxe, basic) are you using?    It may be worth waiting a week or two to see if these bugs clear out.  

3) does the combined total of all mortgages exceed $750,000? if no, then I don't understand why the value in Box 2 matters and it suggests you may be experiencing the bug. 

here is what TT writes in their HELP Notes:

Limits for home equity lines of credit (HELOC

)
The main change to the Mortgage Interest Deduction this year is for home equity lines of credit (HELOC). Now 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). This has always been the case for home mortgage loans.

Example: John took out a home equity line of credit on his home on Tuberose Street for $40,000. He used $25,000 to remodel his kitchen and bathrooms in his Tuberose Street home, and $15,000 as a downpayment on a second house on Snowdrop Lane. He can only deduct the interest he paid on $25,000 he used to improve his Tuberose Street home.

Limits for higher loan balances

There are some updated limits to how much interest taxpayers can deduct from larger loans based on the loan size and origination date. These limitations still apply if you've refinanced the loan on or before this date:

- If you got your loan between October 13, 1987 and December 15, 2017, you can deduct interest on a mortgage up to $1 million for your first and/or second home ($500,000 if Married Filing Separately).
- If you got your loan after December 15, 2017, you can deduct interest on a mortgage up to $750,000 for your first and/or second home ($375,000 if Married Filing Separately).

[billpeatross]

Thank you. I waited a couple weeks and now, as you said, it doesn't matter what I enter for the remaining amount still owed on HELOC. Apparently, there was a bug in TT. My tax due as calculated by TT is much less than it was two weeks ago.