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Calculation error on deductible home mortgage interest worksheet

Level 2

After 2.25 hours on the phone with 3 different techs I still have a problem. Background, I have a client with a refinance loan that originated in 2019. The client paid off old loan and took out a new one for $75,000 more. In 2019 the calculation was flawless reporting only 68.369% of the loan as deductible. Push forward to 2020 and not the same loan on the worksheet has $62,000 remaining of the non-deductible home equity portion of the loan. Based on my manual calculations only 63.484% of the loan should be deductible but Proseries has the deductible portion at 100%. Did I miss something in the tax laws that are now allowing all mortgage interest to be deductible regardless of how it was spent, or is there an error on Part 1 Line 7 of the

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5 Replies 5
Level 8

I learned to use my own Excel worksheet to calculate deductible home mortgage interest.  Multiple threads on this board reflect issues with this calculation in ProSeries.

Level 2

Agreed, but i would still like to know the software I use does not have built in errors. I think it is a cell pointing issue since they added a line to the worksheet in 2020 and now it picks up one line to high. of course, getting a not tax preparer to understand that isn't easy.

Level 2

Well, thank goodness it isn't me going crazy.   I kept looking at the worksheet trying to understand why it wasn't disallowing the equity interest.   
I finally saw where the problem was, as its using the same amount for acquisition debt and average balance, but I can't even override the amount, and then get it to calculate.

They knew there was a problem with the worksheet, because yesterday it was showing as form not final.  When I updated today and the notice was gone, I figured they had fixed the issue.  Silly me!

 

 

 



Level 2

I had the same trouble today.  The worksheet is flawed and does not calculate properly.  Hoping an update will correct this calculation error.

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Level 1

I've been having this same issue with the Mortgage Interest worksheet and think I have it figured out.  When entering the amount for "Interest paid in 2020" line, you'll notice that the "Months loan outstanding" automatically is entering "12" months".  The months loan outstanding is not allowing you to change it unless you override it.  If you have more than one loan it's important to have the correct amount of months each loan was outstanding to allow the "Average balance" for the year to calculate correctly.  What is happening all loans entering are calculating at 12 months which is causing the Average Balance to increase thereby disallowing some interest.  This is not correct.  I tried overriding the Months loan outstanding to the correct amount of months for each loan and unfortunately the program is always calculating as if all loans are outstanding for 12 months.  I have not been able to find a workaround other than not using the worksheet..

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