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Home equity loan interest deductible on rental property schedule E Line 12 in 2019.

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last updated ‎July 06, 2020 10:34 PM

TP rented a property with first mortgage and home equity loan in 2019. The origination date for both  the first mortgage and home equity loan was January 2019.

Is home equity loan interest deductible on rental property schedule E Line 12 in 2019? Thanks for your time and comment.

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Level 10
last updated ‎July 06, 2020 10:34 PM

Throw out all of the bank terminology.  What matters for Sch E is that you're able to trace loan proceeds from the bank directly (or indirectly via the tracing rules in the regs) to an expenditure to buy, build or improve the rental property.

Rick

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Level 10
last updated ‎July 06, 2020 10:34 PM

Throw out all of the bank terminology.  What matters for Sch E is that you're able to trace loan proceeds from the bank directly (or indirectly via the tracing rules in the regs) to an expenditure to buy, build or improve the rental property.

Rick

View solution in original post

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Level 12
last updated ‎July 06, 2020 10:34 PM

@rbynaker wrote:

 to an expenditure to buy, build or improve the rental property.

 


I think it can be ANYTHING traced for the rental property, including repairs, maintenance and taxes.  Right?