Hello, I have a situation where a client wants to re-fi his pure rental property using his personal residence HELOC loan. That interest is a lot lower. Under traceability that would let him deduct it on Sched E ( I think)
but the rental is not securing the HELOC. That makes it a skewed situation but may be allowable.
I dont see a clear discussion on this in the Code.
I hate to tell him yes , than later on IRS disallows and it won't be able to deduct it on personal Sched A because
he didn't spend it to improve his personal residence.
Thanks in advance for any input here.
