@Anonymous_ I figured out that TurboTax takes the average between the outstanding loan amount from the start of the tax year and the amount as of the start of the next year ie end of the tax year. This provides better basis when calculating down the eligible mortgage interest deduction amount. However IRS webpage based worksheet only indicates to consider the outstanding loan amount at the start of the tax year. May I know why TT takes this different approach (which I think is logically correct)?
