Pub 936 defines 3 categories:
1) before 1987
2) before Dec 16, 2017 and under 1M
3) after Dec 16 2017 and under 750k
Pub 936 says if all mortgages fall in one or more of the above categories during the entire year, then all mortgage interest is deductible. It also says the deduction limits for category (2) and (3) should be applied to the combined mortgages on your main home and second home.
Pub 936 does not explicitly state what happens when primary and second home fall in separate categories; i.e. (2) and (3).
Turbotax behavior seems to be:
- first and second home before Dec 16, 2017: deduct up to 1M
- first and second home after Dec 16, 2017: deduct up to 750k
- one home before, one after Dec 16, 2017: deduct up to 1M + 750k = 1.75M
The latter seems to be in line with the text in Part I of Pub 936, but does not match calculations in Part II of Pub 936.
