I'm dealing with this as well. After I said I did a cash-out refi, it asks "Since you first took out the loan, how much has been spent to buy, improve or build the home it's secured by?"
I did not use the extra cash for the home, but I should still be able to use the original loan amount (like in your example) so a portion of my mortgage interest will be tax deductible.
Do I enter the ending balance on the original loan for this then? As the money spent to buy the home? If I put in $0 it doesn't calculate the portion that is tax deductible... and say I don't qualify for any deductions (does not show up on my itemized deduction at all even though I paid over $20k in interests).
