For a refinanced mortgage on a second property, do my payments of that mortgage count towards use of the refinanced money, in addition to property improvements?

I am confused by the rules for a second property that was refinanced and what it takes to qualify for the interest deduction. If i understand the rules correctly, as long as I show that the money I got out of the refinancing has been used for the property, then I can claim all of the interest and property tax. Is that correct? Does paying the mortgage from that money count?

341

Level 15

Jun 4, 2019 1:10:11 PM

as long as I show that the money I got out of the refinancing has been used for the property, then I can claim all of the interest and property tax. Is that correct? Yes this is correct

Does paying the mortgage from that money count? Yes paying off the first mortgage to get a new one is fine.

Now if you take out more money and it is not used for the home -then you have a pro-rated amount that gets deducted.

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For a refinanced mortgage on a second property, do my payments of that mortgage count towards use of the refinanced money, in addition to property improvements?