topic Same principle. You can deduct any interest (bank loan,... in Investors & landlords

If get home equity loan from rental property in 2018 to pay part of the primary residence mortgage acquired a year ago, is the interests deductible against rental income?

ching19 — Mon, 03 Jun 2019 23:55:22 GMT

I have a rental property paid off but have a primary residence carrying mortgage, I would like to get a fixed rate mortgage loan (Not Home equity line of credit) from the rental property to pay part of current primary residence mortgage principles, is the home equity loan interest from the rental property tax deductible against the rental income? Thanks,

Yes, but you have to be very diligent about being able to...

Opus 17 — Mon, 03 Jun 2019 23:55:24 GMT

Yes, but you have to be very diligent about being able to trace the money from the HELOC on your main home to the rental. If you start using the HELOC for other things, it really muddies the waters and you endanger the entire deduction if you get audited. The interest would be deductible on schedule E as a rental expense, not schedule A.

Not HELOC, instead it is fixed rate home equity loan like...

ching19 — Mon, 03 Jun 2019 23:55:25 GMT

Not HELOC, instead it is fixed rate home equity loan like mortgage, will it be same?

it is home equity loan of a lump sum directly use to pay...

ching19 — Mon, 03 Jun 2019 23:55:27 GMT

it is home equity loan of a lump sum directly use to pay the primary residence current mortgage principles

Same principle. You can deduct any interest (bank loan,...

Opus 17 — Mon, 03 Jun 2019 23:55:28 GMT

Same principle. You can deduct any interest (bank loan, credit card, etc) as a rental expense as loan as you can closely trace the borrowed money to the rental property.

Thanks for your answer. Maybe I misunderstood you, but I...

ching19 — Mon, 03 Jun 2019 23:55:30 GMT

Thanks for your answer. Maybe I misunderstood you, but I am using a loan from the rental property to pay the primary residence mortgage, not a loan from primary residence to pay rental property, will this be the same?

Oh I’m sorry, I read it wrong. The loan against the rent...

Opus 17 — Mon, 03 Jun 2019 23:55:31 GMT

Oh I’m sorry, I read it wrong. The loan against the rental property will not be deductible in any way — not as a rental expense and not as a personal itemized deduction on schedule A.

Thanks!

ching19 — Mon, 03 Jun 2019 23:55:32 GMT

Thanks!