Yes, it could be.
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"Investment interest expense is the interest on money you borrow to
purchase taxable investments. For example, you can deduct the interest
on a margin loan you use to purchase stock, but not if you use the
margin loan to buy a car or tax-exempt municipal bonds.
There's a
cap on deductibility equal to your net investment income, but any
leftover interest expense can be carried over for future use, without
expiration.
To calculate your net investment income—and therefore
how much investment interest expense you can deduct—add up your taxable
interest income, ordinary dividends and even long-term capital gains and
qualified dividends (if you make a special election to treat them as
ordinary income, more below). Then, subtract any investment-related
miscellaneous itemized deductions you actually get to use."
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Work through the "Investment Interest Expenses" interview in the "Retirement and Investments" section to enter the investment interest you paid.
Tom Young
