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Luna4
Level 1
January 7, 2022
Question

Pulling out Equity from a refinance

  • January 7, 2022
  • 2 replies
  • 0 views

If I pull out equity from a refinance what are the taxes consequences?  

    2 replies

    DaveF1006
    DaveF1006
    Level 15
    January 7, 2022

    It depends. There is no income tax consequence for pulling out the equity for a refinance because it is considered a loan. However, you will not be eligible for a mortgage interest deduction on the amount you used for personal reasons because the loan was not used to make capital improvements to substantially improve your home. 

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      Mike9241
      Level 15
      Mike9241Level 15
      Level 15
      January 7, 2022

      what did you do with the cash you pulled out? there are tax laws regarding tracing the use of proceeds from a loan.

      Mike9241
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