I'm a long-time homeowner. In 2020, I refinanced my home. Due to the refinance, and switching mortgage banks, I made mortgage payments to three different banks in 2020:

  • Bank A (original mortgager): 8 monthly mortgage payments, January - August
  • Bank B (temporary mortgager): 1 mortgage payment, October
  • Bank C (new mortgager): 2 monthly mortgage payments, November - December

I have received 1098 statements from all three mortgage banks. Now I'm doing my 2020 taxes through TurboTax Online.

When I enter the 1098s for Banks A and C only, it shows me this summary:

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Notice All Deductible interest is $17,446

After that, I enter the 1098 for Bank B. This is the new summary it shows me:

enter image description here

Notice that All Deductible interest has now dropped to $8,908. Just entering the 1098 for Bank B increased my tax bill by thousands of dollars! How is this possible? I don't understand how reporting that I made another mortgage payment (of which most was interest) caused my deductible interest to drop precipitously rather than increase.

Is there a bug in TurboTax?

2 Answers 2


You are right that amount of interest that is deductible shouldn't have gone down.

If you entered them in that order, I am not sure how it dropped.

Nevertheless I would look at the information related to the 1098. What I mean is that every time I enter information from a W-2, 1099, or 1098; Turbo Tax always have a series of questions related to that new piece of data.

In a year where you did a refinance it is possible that how you answered the questions dissociated Mortgage A from the home. I am assuming based on your screen capture this isn't investment property. You have to make sure that Turbo Tax associates these mortgages with your home.

When there is a refinance then how how you handle points changes. Depending on if there was a cash out during the refinance, then some of the interest might not be deductible.

Here is what I would do.

  • Tell Turbo Tax you want to edit the data for all the 1098s. Reread and re-answer the questions.
  • You could also just remove them and reenter the data and answer the questions. You might not want to do this with the existing mortgage, because more data might be associated with it if the basic data was imported from last years form.
  • Change from step-by-step view to forms view and see if you can follow the calculation, to see where the disconnect it.

It is unlikely that there is a software error with this. I expect that a number a related question was answered in a unexpected way.

  • This is one reason I rarely use the interview method. For whatever reason, I needed it to help me enter the data to get the tax credit for my college student, but in general, the 'forms' method feels faster and more accurate. Feb 5, 2021 at 12:14
  • I use both. I found that the only way to get the college items correct was using the forms method. My kids school counted the spring semester tuition on their forms, which would have made the last year of school show no qualified expenses, even though there was a semester of tuition and a final withdrawal from the 529. Feb 5, 2021 at 12:21
  • 1
    Is it relevant that the 1098s for Bank A and C don't have Box 7 checked, but the 1098 for Bank B does have the box checked? It's all for the same house. So thy really all should have checked it.
    – Saqib Ali
    Feb 5, 2021 at 17:27

I recall, the year I had 2 banks, I double clicked the cell to enter mortgage interest and a small form came up letting me itemize. The total flowed back to the cell for the interest deduction. I could have entered as many as I wanted there.

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