Hi,
We bought a house in April 2024. The total loan is $1,120,000. Form 1098 from the lender shows the ending principle at end of 2024 is $835,266.14, the total paid interest is $33,181.32. But we only got about $4600 tax deduction from TurboTax's calculation, which is way below our expectation. But from what is filled into TT, there seems to be correct. What is the behind so low tax deduction?
Your mortgage deduction should be calculated as follows: $750,000/835,266 = ..898 (this is your limitation percentage) x $33,181 = $29,797.
Your mortgage debt can’t exceed $750,000 (or $1,000,000 if the loan was taken before December 16, 2017) to get the full mortgage deduction. It is decreased as a percentage of your total mortgage interest.
If you are using TurboTax Desktop, you can view your "Deductible Home Mortgage Interest Worksheet to see how it was calculated as follows:
If your mortgage interest was not calculated properly, go back and review your mortgage interest input screens.
Your Deductible Home Mortgage Interest Worksheet would look like this:
Click here for Can I deduct my mortgage interest?
Click here for Publication 936 (2024), Home Mortgage Interest Deduction
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