In Feb 2023 I purchased and moved into a new home and converted my previous home into a rental property. I am itemizing this year, so I am splitting the mortgage interest of the home converted into a rental based on the percentage of when it was used as my primary residence and the percentage it was used as a rental property.
When entering this for my schedule A, do I also need to adjust the outstanding mortgage balance based on the percentage it was used as a primary residence? Or do I include the full mortgage balance shown on my 1098?
I want to make sure I do this right, because when I include the full mortgage balance, it exceeds the 750k IRS limit and I get less of a refund.
