I understand what you mean, but unfortunately, the HELOC interest would not qualify.
While the interest received is income, the interest spent is not deductible.
You may be thinking of Form 4952 for investment interest expense, but the instructions state in part:
Investment interest expense doesn’t include any of the following.
• Personal interest under section 163(h), including qualified residence interest.
For the non-qualified residence interest, any deduction would be limited to net investment income.
To see more about this as it pertains to Net Investment Interest Income, see: What is Form 4952: Investment Interest Expense Deduction.
