Why is Turbo Tax limiting my Itemized Deductions to $10,000 for Federal Return?

Forum|Forum|5 years ago
January 26, 2021
4 replies
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I have itemized deductions that total an amount higher than the standard deduction, however TurboTax is limiting that amount to $10,000. Is this an error? This is happening before I even get to State Taxes. This is happening in the federal deductions.

EDIT: For more information, I have Mortgage Interest well over the standard deduction. When I go to check out my mortgage information in TurboTax, it is saying I have $0 in interest. I believe this is an error. How do I get this fixed?

TurboTax Premier Online

Best answer by ryan19

Solved... Went through mortgage interest section again. The very last question is confusing. It asks what my "Adjusted Amount" would be. I initially entered $0, because I had no adjustments. Entered the full mortgage interest in and now TurboTax is calculating properly.

Thank you to both @VolvoGirl and @AnnetteB6 who led me to the resolution!

VolvoGirl

Employee

What kind of deductions do you have? Do you know there is a max 10,000 limit (5,000 MFS) of property tax and state taxes "SALT". SALT is State And Local Tax. Which includes property tax, any state tax paid like for last year’s return and includes any state withholding from your W2s and any 1099s you have. And any taxes in W2 box 14 and 19 like SDI or VDI. You can only deduct up to 10,000 (5,000 MFS) for SALT State and Local Taxes.

And you can only deduct Medical that’s over 7.5% of your AGI. Also the deduction for job expenses have been suspended.

VolvoGirl

Employee

See these 2 FAQ

FAQ on changes

https://ttlc.intuit.com/community/tax-reform/help/how-will-tax-reform-affect-my-federal-tax-return/00/27627

Deductions that have been suspended for 2018-2025

https://ttlc.intuit.com/community/tax-reform/help/which-federal-tax-deductions-have-been-suspended-by-tax-reform/00/25565

dw67

VolvoGirl your links in this posting don't work the first one gets an access error

"You do not have sufficient privileges for this resource or its parent to perform this action."

and the second one fails "We're sorry, we can't find the page you requested."

ryan19AuthorAnswer

Thank you to both @VolvoGirl and @AnnetteB6 who led me to the resolution!

danobegood

I had to delete the entries (main loan and HELOC) that were automatically populated as an information carryover from last year. Once I did that and re-entered as new entries my mortgage interest was accounted for correctly.

Cynthiad66

Some TurboTax customers are experiencing an issue with their Home Mortgage Average Balance. This can cause in the the Home Mortgage Interest to be incorrectly limited.

If you're experiencing the issue above, please go here to receive email notifications when any updates related to this issue become available.

New: retroactive for 2018 and 2019 also, MIP is deductible again. Mortgage Insurance Premiums, see Changes to the Deductibility of Mortgage Insurance Premiums (MIP) | Internal Revenue Service (irs.gov)

[edited 2/11/21 | 12:12 pst]

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dw67

Cynthiad66 your link to the IRS website returns a 404 page not found error.

Clint P

Check your prior years' filings. I missed claiming this state deduction in 2018 & 2019 because TT doesn't pull it through if you opt for standard deductions on the Fed. You have to manually add it through an "adjustment" (per previously posted "solved"). This is stupid. TT should do the analysis on both the Fed and State with the data you input. Just because it's better to claim standard in the Fed doesn't mean it is for the state.

My CPA just caught this and I'm going to re-file.