I would like to use the HELOC on my primary residence to purchase an investment property. I will have taxable income in the investment property. I think, under the interest tracing rule, I would be allowed to deduct the HELOC interest on Schedule E for that investment property. Am I correct in my understanding? I will appreciate your comment.
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Yes, if you used your HELOC to purchase Rental Property, you can deduct the full amount of Mortgage Interest as a Rental Expense on Schedule E.
Don't include that mortgage interest on Schedule A as an Itemized Deduction, in that case.
Click this link for more info on Using HELOC to Purchase Rental Property.
Yes, if you used your HELOC to purchase Rental Property, you can deduct the full amount of Mortgage Interest as a Rental Expense on Schedule E.
Don't include that mortgage interest on Schedule A as an Itemized Deduction, in that case.
Click this link for more info on Using HELOC to Purchase Rental Property.
Hi Marilyn,
Thanks for such a prompt response and very clear guidance.
I noted you are an "Employee Tax Expert". Does that mean you are an employee of Intuit/TurboTax? Just curious.
Kind regards,
Mahendra Singh
Yes, Marilyn is an employee of Intuit/TurboTax.
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