You can claim all of the points paid at closing, (in your case $25,407.51) regardless of the fact that some was paid by the Seller directly or that some was paid by the Seller as an adjustment to commission paid the real estate Agent. You must meet the other requirements (main home, loan balance limits) regarding the Home Mortgage Deduction for the total to be deductible.
According to the IRS:
"amounts the seller pays for points on your loan is treated as paid directly by you from unborrowed funds, provided you subtract the amount of the seller-paid points from your basis (purchase price) in your home."
(The basis, or "your cost", of the home may be necessary to determine Capital gain when the property is sold. If this is the case, you would subtract the amount the Seller paid from your costs to determine an adjusted basis/cost.)
You are correct that points paid at closing and not on Form 1098 need to be entered on line 8c, but the amount is not limited by the portion paid by the Seller. Use your closing statement to report the points paid at closing not reported on Form 1098.
CP28A Notice is usually alerting to an error that home mortgage interest claimed exceeds the limit because of the amount of your home mortgage loan balance for the year. If you held two mortgages in the same year, or your single mortgage put you over the limit (750,000 or 375,000 if filing Married Filing Separately) you'll also need to ensure that the balance of your loan(s) did not effect the amount of interest that you can claim and is the reason for the IRS notice.
More on Home Mortgage Interest
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