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Deductions & credits
In order to deduct interest on a loan, the loan must be secured by your residence so that it qualifies as home mortgage interest. For your personal residence, this is the only option to deduct any loan interest.
So, even though your personal loan proceeds were used to improve your residence, If the loan was not secured by your residence, then the interest is not deductible.
For reference, take a look at Publication 936 (2022), Home Mortgage Interest Deduction. Scroll down to Part 1 - Home Mortgage Interest where the type of interest that can be deducted is defined. There is a 'Note' in that section that states the loan must be secured by your residence to be deductible.
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‎February 10, 2023
7:19 AM