Question on home equity loan - mortgage interest deduction

Technical topics regarding tax preparation.
#1
ajt1970  
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123
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10-Aug-2022 9:15pm
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Midwest
Hi all,

If you take a home equity loan on your personal home and use those funds to get a new roof on your commercial rental building, is the mortgage interest a deduction on schedule E?
 

#2
KoiCPA  
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729
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8-May-2023 1:30pm
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Washington
Tracing rules would apply here. It sounds like the answer would be yes.
 

#3
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24-Jan-2019 2:16pm
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North Shore, Oahu
+1

I think the tax preparation community in general have all agreed to "yes" on this one.
 

#4
Nilodop  
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18756
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21-Apr-2014 9:28am
Location:
Pennsylvania
Is an (o)(5) election needed?

On the one hand, that's used when you want to treat what would otherwise be deductible residence interest as interest traced to a business or investment use. But OP's interest would not have been deductible residence interest because it's in the 2018-2025 provision.

I read the reasoning in CCA 201201017 as supporting no need for the election.
 


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