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In a high speed blender or food processor, add cottage cheese, cheddar cheese, milk and taco seasoning. Process until smooth, pausing and scraping the walls with spatula and adding more milk, if necessary.
Transfer to a medium microwave safe bowl and microwave 2 times in 15-20 seconds increments, stirring once in the middle and once at the end.
Top with chopped tomato, jalapeno, red onion and cilantro. Serve immediately with tortilla chips or fresh veggies.