Thanks for the response. I faxed the IRS back a response quoting again portions of IRS pub 936 that the VA funding fee was fully deductible in 2009 along with e-mails from Chase that they do not put funding fees on their
1098s and an e-mail from the VA that they do not issue 1098s. I'm now waiting for the IRS answer. I'm curious to see whether or not they will tell me to pay back w/ interest a legitimate deduction listed in their own publication. I will update this thread when the answer comes back.