Entering amounts from Form 1098 and 1099 in ProConnect Tax

Scroll down or see here find specific instructions on entering home mortgage interest and other information from Form 1098, along with instructions for entering Form 1099-SA for a Medical Savings Account (MSA)

Form 1098: Mortgage Interest Statement

• Go to Input Return ⮕ Deductions ⮕ Itemized Deductions (Sch A) and select the Interest tab
• See here for more information.

Form 1098-E: Student Loan Interest Statement

• Go to Input Return ⮕ Deductions ⮕ Adjustment to Income and select the Total qualified student loan interest paid tab

Form 1098-T: Tuition Statement

• Go to Input Return ⮕ Credits ⮕ Education Credits (1098-T) (8863/8917)
• See here for more information

Form 1098-MA: Mortgage Assistance Payments

• Go to Input Return ⮕ Deductions ⮕ Itemized Deductions (Sch A) and select the Interest tab
• See here for more information

Form 1099-A: Acquisition or Abandonment of Secured Property

• See here for more information

Form 1099-B: Proceeds from Broker and Barter Exchange Transactions

• Go to Input Return ⮕ Income  ⮕  Dispositions (Sch D, etc.)  ⮕  Schedule D/4797/etc - Various inputs
• See here for more information

Form 1099-G: Certain Government Payments

• Go to Input Return ⮕ Income ⮕ Tax Refunds, Unemployment Comp/1099-G - Various entries

Form 1099-LTC: Long Term Care and Accelerated Death Benefits

• Go to Input Return ⮕ Deductions ⮕ HSA/MSA/LTC Contracts(1099-SA, 5498-SA) - Various entries

Form 1099-Misc: Miscellaneous Income

• See here for more information

Form 1099-NEC: Nonemployee Compensation

• See here for more information

Form 1099-OID: Original Issue Discount

• Go to Input Return ⮕ Income ⮕ Interest Income (1099-INT, 1099-OID) - Various entries

Form 1099-Q: Payments from Qualified Education Programs

• Go to Input Return ⮕ Income ⮕ Education Distributions (1099-Q) - Various entries

Form 1099-R: Distributions From Pensions, Annuities, Retirement or Profit Sharing Plans, IRAs, Insurance Contracts, etc.

• Go to Input Return ⮕ Income ⮕ Pensions, IRAs (1099-R) - Various entries
• See here for more information.

Form 1099-S: Proceeds from Real Estate Transactions

• Go to Input Return ⮕ Income ⮕ Dispositions (Sch D, etc.) > Schedule D/4797/etc - Various entries

Form 1099-SA: Distributions From an HSA, Archer MSA, or Medicare Advantage MSA

• Go to Input Return ⮕ Deductions ⮕ HSA/MSA/LTC Contracts(1099-SA, 5498-SA) - Various entries

Entering home mortgage interest and other information from Form 1098

Box 1 and box 2

1. Go to Input Return ⮕ Deductions ⮕ Itemized Deductions (Sch A)
2. Select the Interest tab.
3. Click in the field labeled Home mortgage interest & points on Form 1098 [Adjustment] to expand the input.
4. Enter the Description and Amount.
   • Enter the deductible portion of home mortgage interest paid directly or indirectly to financial institutions for which the taxpayer received a Form 1098, Mortgage Interest Statement. The program doesn't apply limitations to entries in this field (see the note below for excess mortgage interest information).
   • If the taxpayer is claiming the mortgage interest credit and you have entries in the Credits section in the screen, EIC, Residential, Oth. Credits in the section, Mortgage Interest Credit (8396), the program will reduce the home mortgage interest by the credit.

A note on the Excess Mortgage Interest input section

Refer to the Excess Mortgage Interest input section at the bottom of the screen, Itemized Deductions (Sch A) if:

1. The taxpayer took out any mortgage after October 13, 1987, and used the proceeds for purposes other than to buy, build or improve the home, and all of these mortgages totaled over $100,000. The limit is $50,000 if married filing separately. An example of this type of mortgage is a home equity loan used to pay off credit card bills, buy a car, or pay tuition.
2. The taxpayer took out any mortgage after October 13, 1987, and used the proceeds to buy, build or improve the home, and these mortgages plus any mortgages taken out on or before October 13, 1987, totaled over $1 million. The limit is $500,000 if married filing separately.

Box 3

Per the IRS Instructions for Form 1098, box 3:

• Do not deduct this amount. It is a refund (or credit) for overpayment(s) of interest you made in a prior year or years. If you itemized deductions in the year(s) you paid the interest, you may have to include part or all of the box 3 amount on the Other income line of your Form 1040. No adjustment to your prior year(s) tax return(s) is necessary. For more information, see Pub. 936 and Itemized Deduction Recoveries in Pub. 525.

Follow these steps to enter Form 1098, box 3 as Other Income:

1. Go to Input Return ⮕ Income ⮕ SS Benefits, Alimony, Misc. Income.
2. Scroll down to the Alimony and Other Income section.
3. Click in the field labeled Other income (Click on the button to expand) to expand the input field.
4. Enter a Description and Amount.

Box 4

Starting in tax year 2022 you can no longer deduct Qualified Mortgage Insurance Premiums on the Schedule A. The steps below will apply to tax year 2021 and prior

ProConnect Tax still contains an input field, however, it won't flow to Schedule A or 1040.

Follow these steps to enter box 4:

1. Go to Input Return ⮕ Deductions ⮕ Itemized Deductions (Sch A).
2. From the top of the screen, select the Interest section.
3. Enter the amount in the field Qualified mortgage insurance premiums paid on post 12/31/06 contracts.

Entering Form 1099-SA for a Medical Savings Account (MSA)

1. Go to Input Return ⮕ Deductions ⮕ HSA/MSA/LTC Contracts (1099-SA, 5498-SA).
2. Select Medical Savings Accounts (8853).
3. Enter a 1 or 2 in 1=self-only coverage, 2=family coverage.
4. Scroll down to the MSA Distributions section.
5. Enter the Total MSA distributions received (1099-SA, box 1).
6. Enter any qualified medical expenses the client paid in Total unreimbursed qualified medical expenses.

If the amount of the distribution exceeds the amount of unreimbursed qualified medical expenses, the difference is taxable and will flow to the Form 1040 as Other Income with a description of "MSA." An additional 20% tax will be calculated on Form 8853, Part III.

Any or all of the amount may be excluded from the 15% tax by making an entry in the Amount to exclude from 20% tax (1=exclude all) field on this screen. The 20% tax doesn't apply if the distribution is made after the account holder dies, becomes disabled, or reaches age 65.