It depends. As indicated in the reference you provided, the loan would need to be associated with a trade or business for any deduction on the mortgage you might choose to elect to be not secured by your home.
- A purpose of this election is to permit a debt that is allocable to trade or business expenses, and thus deductible without regard to the section 163(h) deduction, to not “use up” the limitation, thereby causing otherwise deductible debts to fail to qualify under the limitation.
- The election must apply to the entire indebtedness, and the election is made by reporting the interest on the return as business interest or other deductible interest rather than qualified residence interest.
- This treatment begins with the tax year for which you make the choice and continues for all later tax years. You can revoke your choice only with the consent of the IRS.
- A statement attached to your return would let the IRS know and approve.
It is not a common circumstance in my experience. This could be utilized and part of the debt would be considered used for business expenses.
- You may want to treat a debt as not secured by your home if the interest on that debt is fully deductible (for example, as a business expense).
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
