I am trying to use IRS publication 936 Table 1 to make sure I am deducting the correct amount of mortgage interest.
I bought Home A with Mortgage A in 2015.
I bought Home B with Mortgage B in November of 2023.
I sold Home A on February 29, 2024 thus paying off Mortgage A.
I used the proceeds from Home A to pay off Mortgage B on March 1, 2024.
2024 Total Interest from Mortgage A: $2,262.36
Mortgage A balance on Jan 1 2024: $355,513.62
2024 Total Interest from Mortgage B: $29,355.28
Mortgage B balance on Jan 1 2024: $1,551,250
(The balance wasn't that much lower when I sold maybe a couple thousand dollars for each mortgage.)
I believe Turbo Tax is using the "Average of first and last balance method" (with the last balance being 0$) to compute average balances. When I (and turbo tax) do this the result comes out roughly the same $24,873. TurboTax is asking me if values that I get are different. Should ($0) be the number used for last balance or is there something I'm missing here? I'm afraid I'm doing this wrong and to not missing out on deducting more interest?
