Any answer for this. I am having the same confusion as @tbain98 .
Does it make sense to amortizes over months when the taxpayer didn't own the property?
I looked specifically into IRS Pub 936, and there are conflicting information as well.
On one hand, it says "For each mortgage, figure your average balance by adding your monthly closing or average balances and dividing that total by the number of months the home secured by that mortgage was a qualified home during the year.
On the other hand, there is an example in the same publication, that does amortization over the whole year.
"In 1986, Sharon took out a first mortgage of $1,400,000. The mortgage was a 7-year balloon note and the entire balance on the note was due in 1993. She refinanced the debt in 1993 with a new 30-year mortgage (grandfathered debt). On March 2, 2022, when the home had a fair market value of $1,700,000 and she owed $500,000 on the mortgage, Sharon took out a second mortgage for $200,000. She used $180,000 of the proceeds to make substantial improvements to her home (home acquisition debt) and the remaining $20,000 to buy a car (home equity debt). Under the loan agreement, Sharon must make principal payments of $1,000 at the end of each month. During 2022, her principal payments on the second mortgage totaled $10,000. To complete Table 1, line 7, Sharon must figure a separate average balance for the part of her second mortgage that is home acquisition debt. The January and February balances were zero. The March through December balances were all $180,000 because none of her principal payments are applied to the home acquisition debt. (They are all applied to the home equity debt, reducing it to $10,000 [$20,000 − $10,000].) The monthly balances of the home acquisition debt total $1,800,000 ($180,000 × 10). Therefore, the average balance of the home acquisition debt for 2022 was $150,000 ($1,800,000 ÷ 12)."
Any ideas? @DMarkM1 @RaifH
