@zomboo
My 1098 says my mortgage balance is $1,409,042, and the mortgage originated in December 2020. This is because it's a second refinance to take advantage of the lower rates at that time. The balance from my original cash-out refinance in September 2018 was $906,006.
I think I have a few options:
- Check the box "The interest amount I entered is different than what's on my 1098", adjust the $36,575 there from my 1098 down to the proportional amount of interest from $906k vs. the original September 2018 balance of $1,526,000. Then I will also have to say the loan origination date was November 2012, which is not what's on the 1098.
- Just take the $750k limit. If you think about the math from #1, that makes my effective mortgage cap $836k, which is higher than $750k. It would be nice to have $836k. But, if there's no clean way to do it, maybe it's not worth it.
- Go for the $1M limit. Perhaps I can morally rationalize that I did spend $450k remodeling the property after I bought it, but before I refinanced it, so the $620k cash-out in many ways just went to pay myself back for improving the property. At least enough of it to justify keeping the $1M limit. All I have to do to get this is to say the proceeds of the refinance went towards improving the property.
In a perfect world I'd be able to fill in the Schedule A Deductible Home Mortgage Interest Worksheet myself, specifically the "Average amount of debt acquired after October 13, 1987 and before December 16, 2017" (Line 2), and put in $836k. But instead it seems like I have a collection of bad options.
