Trecing rules and home mortgage

Do we still have tracing rules? Can taxpayer borrow $500K on home's equity, use that money to buy an apartment complex, and trace that interest expense to the apartment complex?

Or the taxpayer that did the same 10 years ago. Can she still trace that interest expense to the apartment complex like she has done for 10 years?

I think that tracing is still OK. I have a client who has done this repeatedly. Have not seen her yet this year, but have been thinking about this. She has an appointment in a couple of weeks, so I will be researching this further. I'll let you know what I find.

Would the -10T(o)(5) "election" still be relevant? How would it work?

Just noticed I misspelled tracing in title (trecing). Seems I saw something in the literature recently that warned accountants to advise there clients NOT to borrow money against the equity in the homes to buy other real estate, as they will NOT be able to trace that interest. I wish I would have saved it. I will try to find and see exactly how it read and how reliable a source it came from.

However, from the 2018 Form 1040 instructions for Schedule A, I just found the following:

If you used any home mortgage
proceeds for a business or investment
purpose, interest you
paid that is allocable to those proceeds
may still be deductible as a business or
investment expense elsewhere on your
return.

So maybe there is hope.