I have the following situation in 2021:
Converted my primary home into a rental property (Property 1)
Purchased a new home (Property 2)
Initial mortgage of new home was immediately sold to another loan servicer (Property 2)
Refinanced new loan (Property 2)
I have received 4 1098 forms and both properties were my primary home at some point in 2021. The mortgage for property 1 is ~$410k and property 2 is ~$700k. It is my understanding that I should be able to deduct 100% of the mortgage interest (minus the prorated portion of the rental property) for these properties as my primary home mortgage was < $750k at any given time.
This is a similar situation to what was asked in this thread: https://ttlc.intuit.com/community/tax-credits-deductions/discussion/2-homes-and-2-loans-one-converte...
where an employee/expert confirmed this should all be deductible, but the software is incorrectly adding the two mortgage balances together and limiting the deductions. The workaround to change the 1098 value seems like it doesn't apply here as I still have the mortgage on both properties, so marking one outstanding balance as $0 seems wrong and inviting of audits
