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Deductions & credits
Q. Am I able to deduct mortgage interest from my personal income (ie treat it as a second home for tax purposes) or does my selection on the affidavit of occupancy preclude this?
A. No, if it is investment property. Yes, if it is a second home.
But, I'm not a lawyer, and a definitive answer may require one.
Your intent is as an investment and that may be good for the mortgage application. For tax purposes, it appears you have a 2nd home, because you have personal use (a close family member lives there). When it comes time to sell, a gain will be taxed at capital gains rate. But if there is a loss, the personal use rule precludes you from deducting that loss.
‎April 26, 2023
4:09 AM