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Returning Member
posted Apr 5, 2022 8:15:42 PM

Using proceeds from a rental property HELOC

Does anyone know if it's possible to get a home equity loan or HELOC on a rental property, use the proceeds for a home improvement on a primary residence and then deduct the interest from the loan?  What confuses me is that the home improvement is not on the home from which the HELOC was originated.  Does it make a difference? 

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1 Replies
Expert Alumni
Apr 6, 2022 5:06:42 AM

If you take out the loan on a rental property and use the proceeds to renovate your residence, then you cannot deduct the interest paid as a rental expense, as the loan was not used for the rental home.

 

You cannot deduct the interest as an itemized deduction either as the loan is not secured by your residence.