No, not the hedge fundie’s rake-off. Judge Emin (“Eminent”) Toro has mortgage interest to deal with in Henry O. Igboke & Clara Igboke, Docket No. 12275-24, filed 6/3/26, in an off-the-bencher. Henry & Clara had some mortgage woes in a prior year, from which they refinanced out, paying accrued interest with proceeds from the new loan.

But apparently the accrued interest, though Section163(h) qualified residence interest, was too much to deduct against that year’s income, so Henry claims the overage in year-at- issue.

First problem: the IRC doesn’t allow that.

Second problem: Henry  “…has been a certified public accountant for more than 30 years and regularly prepares tax returns for his clients. He knows how the federal income tax rules work, including those for the home mortgage interest deduction.” Transcript, at p. 4.

Third problem: On the trial, Henry proffers two documents to substantiate his deduction, namely, a substitute Form 1098 and a letter from the servicer of the old mortgage which Henry & Clara refinanced in the prior year. But “[prior mortgage servicer]’s recordkeeper could not find copies of either document in [prior mortgage servicer]’s records. Even more troubling, the alleged Substitute Form 1098 for [year-at-issue] appears to be an altered photocopy of the [prior year] Form 1098 from [prior mortgage servicer]. All the numbers on the purported [year-at-issue] form are identical to those from [prior year], including the interest paid and loan balance. But, on the purported [year-at-issue] form, the [prior] year has been replaced with [year-at-issue], and there appear to be irregular photocopier markings around the year. An [prior servicer] legend has been added at the top of the form, along with a banner that reads ‘Mortgage Interest Statement – Substitute Form 1098.’

“Further, the … letter that [prior servicer] allegedly sent the Igbokes is inconsistent with the Igbokes’ claimed deduction for [year-at-issue]. If the Igbokes had paid $31,635 in interest to [prior servicer] for [year-at-issue in addition to the $18,411 they paid to [current servicer] for that year, they would have been entitled to deduct $50,046 of mortgage interest on their [year-at-issue] return. At trial, Mr. Igboke provided no explanation for why the Igbokes claimed a lower amount on their [year-at-issue] return. Moreover, the Transaction History provided by [prior servicer] refutes Mr. Igboke’s claims and shows no payments of any kind after [prior year]. Transcript, at pp. 11-12.

Confronted with these inconveniences, Henry claims former servicer told him he could carry forward the prior year’s overage. “Mr. Igboke says he relied on this advice from [prior servicer] despite his 30 years of experience as a CPA and [prior servicer] ‘s lack of authority to create tax rules.” Transcript, at p. 12.

IRS wins.