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Level 2

Heloc Loan and Home Improvements

I'm thinking of getting a HELOC loan to do home improvements. Where can I find out whether the home improvements I have in mind would qualify for the interest of the HELOC to be deductible? For example, I need to replace my 40 year old windows, need to install ceiling lights in living room, need new flooring in living room, need painting done, and need to upgrade laundry room with flooring and new washer/dryer. Would washer/dryer be considered home improvement or not? Painting? Windows, etc? Or are some of these non-home improvement. Replacing table, bookcases, sofa in living room would be non-home improvement, right?

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Employee Tax Expert

Heloc Loan and Home Improvements

See page 10 of Publication 936, which explains what a "substantial improvement" is for purposes of the mortgage interest deduction:


Substantial improvement. An improvement is substantial if it:
• Adds to the value of your home,
• Prolongs your home's useful life, or
• Adapts your home to new uses.
Repairs that maintain your home in good
condition, such as repainting your home, aren't
substantial improvements.


Purchasing appliances and furniture are not home improvements.

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