If the bond can be treated as a mortgage, then you could deduct the interest portion of the payment, if you can prove how much that is. The bond would be treated as a mortgage if it is a lien against the house such that you could be foreclosed and lose your house if you did not make the bond payment.
The principal part of the bond payment, since it was for real property improvements, can be included in the cost basis of your home and may reduce your capital gains tax when you sell.
