Need clarification about mortgage interest deduction.
The acquisition debt is approximately $350,000. Did a cash out refi of $419,000.
$40,000 was used for home improvement. The balance of $29,000 was used towards purchase of land.
It is my understanding that the interest on $29,000 is not deductible, but the rest of the interest based on loan amount is deductible. Is this correct?
Also, do I have to keep entering the loan as a refi cash out for the duration of the loan?
