Im buying a vacation rental and wondering which affords the better mortgage interest tax deduction. Getting a cash out refinance of my primary for the purchase or getting a regular purchase mortgage on the rental property? The interest rates are higher on the rental property loan.
Thanks
You can’t deduct the interest from the refinance unless the loan is used to buy, build, or substantially improve the property that secures the loan.
The mortgage payment for the vacation rental is about $200 more per month than it would be if I do a cash out on my primary residence.
Your question addresses only one aspect of your financial situation. At your income level you would be well advised to consult a certified financial advisor to consider your entire financial situation and goals.
Refinance or take out a second loan?
Do you Itemize?
As was mentioned, at your income level, it is in your best interest to go to a good tax professional and/or financial advisor that can look at your ENTIRE situation, rather than asking random people on the internet with limited knowledge about your specific circumstances.