Do I report Mortgage interest for Rental Property as rental expense or an itemized deduction?

Forum|Forum|6 years ago
June 4, 2019
5 replies
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I am confused about mortgage interest regarding my rental property. It says to not enter under personal but to put it under the expenses of the rental. Do I just skip this part all together? If so, How? Thank you for your help!

TurboTax Self Employed Online

Best answer by DS30

Yes, for your rental mortgage interest, just report this under your rental section. Any portion that is not available for your Schedule E will automatically go to Schedule A (on one of your rental properties).

It is important to note that for the mortgage interest deducted on Schedule A, you are only allowed an itemized deduction for your main house and ONE additional residence. The IRS does NOT allow a personal mortgage interest deduction (on Schedule A) for more than TWO homes.)

If you enter it in both places, your deductions will be counted twice.

DS30Answer

Employee

If you enter it in both places, your deductions will be counted twice.

Anonymous

Some answers say we have to manually prorate, which would set up a flag that the 1098 doesn't match what was actually reported. When I look at the forms TT prorates for you based on days rented. Very confusing and no consistent answers. Please help!!

KrisD15

If the interest and/or property tax is for ONLY a rental, ONLY enter that information as rental expenses on your Schedule E. Do not also enter it on the 1098 Home Mortgage Interest, that screen is only for the interest and property tax on your personal residences (one primary home and one personal use only vacation home).

If you have a rental that is also used for personal use, or you rent out part of your home, enter the information only on the Schedule E screen and TurboTax will allocate the amounts between rental expenses and Schedule A.

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jimb108

To be clear, I rented a room (10% of sq ft) in my house for 95 days in 2019. So when you say "enter the information only on the Schedule E screen and TurboTax will allocate the amounts between rental expenses and Schedule A."

This mean enter 100% of interest and taxes in the "Rental Properties and Royalties" section which is for Schedule E, right? (The screen says "since we are allocating, be sure to enter 100% of your expenses in these fields"). When I do that, 90% of expenses are allocated to Schedule A and 10% are on Schedule E.

So far so good?

So when I get to the "Let's get the details from your Mortgage 1098" screen in the Deductions & Credits section do I enter only the balance of my mortgage interest and taxes and check the box that says " The interest amount I entered is different than what's on my 1098". This seems the only way to get the numbers on Schedule A to add up to what I actually paid as is stated on my 1098.

Because if I enter the totals directly from my 1098 on this screen Schedule A is over inflated.

Thanks!

KarenJ2

Yes, you would only enter the balance. You would need to take the total amount from your 1098 and manually subtract the amount TurboTax has allocated for the rental and enter the remaining amounts allocable to personal use.

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