HELOC used to buy a rental
Varies
Can You Write Off HELOC Used to Buy a Rental?
Short answer: Yes: interest on a HELOC on your home that funded a rental purchase or down payment is deductible on Schedule E.
Interest follows how the borrowed money is spent, not what secures the loan, so loan proceeds traced to the rental make the interest a rental expense.
Records to keep: Keep leases, receipts, a log of repairs vs improvements, mileage to the property, and closing statements.
HELOC used to buy a rental
Varies
Real Estate / Landlords / Property Managers / Agents
Yes: interest on a HELOC on your home that funded a rental purchase or down payment is deductible on Schedule E.
Business justification
Yes: interest on a HELOC on your home that funded a rental purchase or down payment is deductible on Schedule E. Interest follows how the borrowed money is spent, not what secures the loan, so loan proceeds traced to the rental make the interest a rental expense.
Category
- Rental Property Write-Offs