Is the interest paid on home improvement loans deductible?

[michael-konen]

Is the interest paid on home improvement loans deductible?  I'm looking into putting solar panels on my home and there appear to be lots of different financing products.  From my understanding, I would be able to deduct the interest paid on a normal mortgage, HELOC, and home equity loans.  Do home improvement loans also fall into this category?  Do only certain products fall into this category, or is any interest deductible as long as the intent of the financing is to support your primary residence?  Thanks 

[Carl]

If the money was used to build or improve your residence, then yes, provided the loan is secured. If the loan is secured, then either box 7 of the 1098 will be checked, or the address of the property that secures the loan will be shown in box 8 of the 1098.

[Vanessa · Accepted solution]

Yes, Home Improvement loans fall into this category as long as they are used to buy build or substantially improve the home that the loan secures. 

There is a cap for indebtedness of $750,000.  So if all mortgages on the home total more than $750,000 (Since you will be taking this out after 12/16/17) you would only be able to deduct interest on the first $750,000.

https://www.irs.gov/publications/p936