Yes, you can deduct a home equity loan, if that is the type of loan used for your pool. The loan must be like your mortgage in regards to the security on the home until repayment in full.
A home mortgage is any loan that is secured by your main home or second home, regardless of how the loan is labeled. It includes first and second mortgages, home equity loans, and refinanced mortgages.
- Search (upper right) > type 1098 > Click the Jump to... Link
- Complete the mortgage interest section as though you did have a 1098 and then answer the questions
- Choose to 'Type it Myself' > Enter the Lender's name - Have your statement available with the information and keep it with our tax file.
- Complete your information as though you did have the form
Limit for loan proceeds not used to buy, build, or substantially improve your home.
You can only deduct home mortgage interest to the extent that the loan proceeds from your home mortgage are used to buy, build, or substantially improve the home securing the loan ("qualifying debt"). Make sure to check the box on line 8 if you had one or more home mortgages in 2022 with an outstanding balance and you didn't use all of the loan proceeds to buy, build, or substantially improve the home.
Limit on loans taken out after December 15, 2017.
For qualifying debt taken out after December 15, 2017, you can only deduct home mortgage interest on up to $750,000 ($375,000 if you are married filing separately) of that debt. If you also have qualifying debt subject to the $1,000,000 limitation discussed under Limit on loans taken out on or before December 15, 2017, earlier, the $750,000 limit for debt taken out after December 15, 2017, is reduced by the amount of your qualifying debt subject to the $1,000,000 limit.
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