Deducting interest from HELOCs
Posted: 15-May-2019 2:46pm
The rule on HELOCs, as of 2018, is they are no longer deductible unless used to buy or improve a home or second home.
Some clients take out a HELOC as part of a maneuver to refinance their original loan.
Here's an example:
2015: Taxpayer takes out $800K mortgage loan to purchase house.
2018: Taxpayer takes out $50K HELOC which they use to refinance their original mortgage loan.
Is the interest on the HELOC still deductible in 2018?
Some clients take out a HELOC as part of a maneuver to refinance their original loan.
Here's an example:
2015: Taxpayer takes out $800K mortgage loan to purchase house.
2018: Taxpayer takes out $50K HELOC which they use to refinance their original mortgage loan.
Is the interest on the HELOC still deductible in 2018?