Mortgage debt cap loses grandfathered debt when equal balances put the newer loan first #10011

Problem

_limited_mortgage_balance in policyengine_us/variables/household/expense/tax_unit/mortgage_interest_structure.py picks each loan's cap by balance size, not by which debt is grandfathered. With equal balances, first_is_smaller is false, so the result depends on loan order.

Take a JOINT tax unit with two $775,000 acquisition loans, one originated in 2017 (grandfathered, $1,000,000 cap) and one in 2018 ($750,000 cap):

Under 26 U.S.C. 163(h)(3)(F), grandfathered acquisition debt keeps the $1,000,000 limit, and it reduces the $750,000 limit for newer debt, to no less than zero:

min(775,000, 1,000,000) + min(775,000, max(0, 750,000 − 775,000)) = 775,000

This assumes both loans are qualifying acquisition debt, the 2017 loan was incurred on or before December 15, 2017, and there's no refinancing or binding-contract exception. The model stores only the origination year.

Reproduction (current main)

Calling the helper directly on main, with both orders as one vector, returns [750000, 775000]. The expected result is [775000, 775000].

At the household level, take 2024, JOINT, $62,000 of mortgage interest ($31,000 per loan), balances of 775,000 each, and origination years 2018/2017. The deductible interest comes to $30,000, where the statute gives $31,000. With the order swapped, it's $31,000.

Sources

• 26 U.S.C. 163(h)(3)(B)(ii) and (F). P.L. 119-21 §70108(a)(1)(B) renumbers the grandfathered-debt clause for tax years beginning after 2025 (text).
• Parameters: policyengine_us/parameters/gov/irs/deductions/itemized/interest/mortgage/ (cap.yaml, pre_tcja_cap.yaml, pre_tcja_origination_year.yaml).

Acceptance criteria for a fix

• Regression: require $775,000 of qualified balance, and $31,000 deductible interest in the example above, in both slot orders.
• Property and differential tests:
  • a slot-swap property;
  • a differential test against a reference that caps grandfathered debt first, then reduces the newer-debt allowance;
  • ties, and balances below, at and above both caps;
  • JOINT and SEPARATE caps.
• Bounds:
  • 0 ≤ qualified balance ≤ total balance;
  • 0 ≤ deductible interest ≤ total interest;
  • deductible + nondeductible = total interest.
• No-balance convention: keep the existing full deduction when no balance is supplied.

Found while reviewing #9605, which removes inputs and doesn't change this helper. The bug predates it.