You will need to answer yes. Every year that you report this loan, you will need to say yes and track the portion of the loan, whether you refinance again or not, that is related to the cash out portion. The reason is, the interest on the cash out portion is not deductible. So if you paid $10,000 in interest in 2021 and 45% of your loan first refinance was a cash out, 45% of the interest will not be tax deductible. You would only get a deduction of $5,500 for interest paid, not the full $10,000.
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