Thanks for your response.  I received communication from Intuit about 2 days after submitting my inquiry. ... View more

Thanks for your response, but this approach effectively doubles the loan value, causing the amount of interest deduction to be reduced when filing in the state of California. ... View more

Thanks to all you good folks at Intuit for giving this issue the attention it deserves! Yay! ... View more

Hi Kat (and others),   My apology for the lengthy delay in responding to your messages.  I was able to submit the return by entering $1 in Box 2 for the 2nd form 1098.  I'm not sure how this will affect our reporting in 2020, but I suspect it will not cause any problems. I'm not so interested in supplying a diagnostic file as I'm not convinced personal information would be protected.  That said, I'd be willing to work with a specialist by way of telephone and providing the field inputs as I've experienced the issue.  Feel free to message me via this chat thread for instructions on how to connect in this manner. Thanks for your interest and your help! Joseph ... View more

Hi Kat, So, it appears my "work around" is not solving my problem as TurboTax will not permit me to eFile the return without the alleged deficient information missing.  I could really use some technical support. ... View more

Hi Kat,   Thanks for your message.   By the IRS website, lenders use Form 1098 is to be used, "... to report mortgage interest (including points, defined later) of $600 or more you received during the year in the course of your trade or business from an individual, including a sole proprietor. "  Box 2 on form 1098 reports the principal loan balance as of January 1 of the reporting year.  That is, the loan balance at the beginning of the year, not the year-end balance.  Institutions transferring loans to contra financial institutions have the reporting requirement; the receiving  institution does not have the responsibility of reporting this information because they were not the servicing institution at the time the loan balance was established.  They will have this responsibility for the following reporting year if they remain as the servicing agent.   The problem with TurboTax is that it does not permit the user to proceed with the preparation of the tax return if Box 2 is left blank (empty) as shown on Form 1098 (as in my situation) because the software requires a value in the Box 2 field of the step-by-step data entry.  TurboTax then aggregates the Box 2 information to determine the loan balance which results in erroneous mortgage indebtedness.  Put another way, it appears TurboTax automatically assumes two 1098's must represent two loans (e.g., 1st DOT, 2nd DOT, etc.).  ONE LOAN that is sold between financial institutions IS NOT TWO LOANS, but generates TWO 1098's.  The issue becomes more critical when the user prepares their State return, especially in California where loan balances commonly exceed $500,000.  TurboTax thinks there is a single loan in excess of $1MM which triggers certain tax situations that reduce the taxpayor's interest deduction, thus resulting in an erroeously increased tax liability.   I was able to work around this issue by leaving the field blank and switching to the Forms View before selecting "continue".  After reviewing the reporting form to ensure it accurately reflected the 1098 issued by the servicing company, and then switched to another form in Forms View to save my information before switching back to the step-by-step feature.   Allowing TurboTax to accept a blank field in Box 2 of the step-by-step form would solve this issue.  A follow-up screen could appear after the form was complete to confirm with the user that in fact the Box 2 field is blank on Form 1098 before continuing with the data entry.   Hope this is helpful... thank for your interest!   Joseph @Kat  ... View more

Thanks for your reply... Box 2 reflects the value of the loan at the beginning of the year.  This reporting requirement is the responsibility of the servicing agent on that date.  The Box 2 reporting requirement does not reside with the servicing agent receiving the loan. They are not responsible for reporting this information because they were not servicing the loan at that time.  It is for this reason the new servicing agent leaves this box empty.  TurboTax needs to be written in a way that provides an accommodation for this very common issue.  Short of that happening, I was able to figure out a work-around by switching to the Forms View in TurboTax after completing the Form 1098 values, including leaving the Box 2 value empty <<null>>, but before selecting "continue".  This allowed me to close the Step-by-Step form and continue preparing the return.  I just ignored the results when I ran the "error check".  Hope you find this useful. ... View more