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Deductions & credits
The interest deduction is not based on mortgage balances month-to-month. It is based on the average monthly balance. TT calculates the average balance by summing the beginning and ending balances and dividing by 2. This is not the proper averaging method to use this year if you made an additional principal payment of over $50K to bring your mortgage balance below $750K.
You should use the Statements Provided By Your Lender method described in Pub 936. With a majority of your monthly balances below $750K, this method could yield most or all of you interest deductible.
‎January 12, 2025
3:38 PM
3,249 Views