Why didn't my refund change when I entered my mortgage interest and property (real estate) tax?
Here are a few reasons why this may have happened:
- You still get a bigger refund with the standard deduction
This is usually the case for new home buyers, since they haven't paid enough property (real estate) tax or interest for a big tax break. But we're keeping track, and if itemizing gets you a bigger refund once you add more info, we'll switch.
- It’s not equal
Even if you’re itemizing, entering $2,500 of deductions doesn’t usually mean a $2,500 refund. You’ll only get the difference up to the amount you’re allowed by the IRS. For example, let's say your maximum allowable deduction is $12,600, and you’ve already claimed $12,500 of it. Your $2,500 claim will only add $100 to your refund.
- You owe AMT
This isn’t common, but if you owe Alternative Minimum Tax (AMT), you can’t deduct property (real estate) tax.