this is actually a little more complicated - because there was a HELOC that was paid off.
the acquisition debt is the original loan balance used to purchase the house.
Then it appears there was a HELOC - what did you use that money for? home improvement or not?
then it appears you did a cash out refi and paid off the 1st mortgage and the HELOC and you have yet to use the cashout money for improvement.
Let's say the original aquisition debt was $100,000 and had amortized down to $90,000 at the time of the cash out. Further, the HELOC has a balance of $25,000. Then the cash out refi was a new $150,000 loan.
In this example, the interest on the first $90,000 is clearly deductible interest. The interest on the remaining $60,000 (including the HELOC interest prior to the payoff) is not tax deductible, unless the momey was used to improve the house. It could be some of that $60,000 is used to improve the home and at that point, the related interest is tax deductible.
