Hello,
I have a hypothetical question about whether a margin loan placed into a Money Market Fund (e.g SPAXX) would allow me to accrue deductible interest that can be used to offset other investment income (assuming it qualifies under publication 550). For example,
1. I take out a margin loan against an individual brokerage account
2. I deposit the entire balance into a money market account
3. The entire amount is held in the MMF until $Y margin interest is accrued
Assuming my total investment income was greater than or equal to $Y, would I be able to deduct the interest I paid on the loan? Is using a MMF in this way fundamentally different (other than level of risk and interest paid) than holding any other security. Apologies if my question isn't clear.
Thank you!
