HELOC open 2007 (30k) and ReFi in 2015 (balance now $12k). How much to deduct?

[jbdkisner]

2007 - took out a HELOC for 30k. 15k was used for house (roof and A/C) and 15k was personal.

2015 - Refi the HELOC and balance was 14k.

End of 2018 - balance is $12400. Interest paid in 2018 was $1004

What would be the best way to claim HELOC deduction now?

My thought is that from the original HELOC, 50% was for house.  Since I paid $1004 in interest in 2018, I would deduct 50% of $1004 - or $502.  Would the be right.

Couple issues - i have no records of the improvements back in 2007 (Do not save anything back that far). The contractor for $9000 of the work is out of business. I do have the HELOC paper work from 2007 and 2015.  So if the IRS wants to audit, how can I prove it.?

[DDollar · Accepted solution]

You are correct about the amount of interest from your Home Equity Line of Credit to deduct - $502. 

It is unlikely you would be audited over a $502 deduction.  Moreover, the IRS doesn't really expect you to retain records from as far back as 2007.  If they were to inquire, your reasonable explanation would probably suffice, unless perhaps there was other issues they were looking into.