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Is the interest on $200k home equity loan used to buy a new primary residence deductible on Sch A.?

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Home Equity

We are planning to rent our existing home and pull 0k equity from that home to buy a new primary residence. I am not clear about the 0k deductible limit on the home-equity loans. Can I deduct it on Sch A or against the rental income and is the deductible equity loan capped at 0k. We file married jointly and our AGI is 0k.

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    The loan is on the rental property, stupid move, as now you have full capital gains tax, but that is not your question. The interest is not applied to your primary home, but to your rental.

    Landlord - Sep 07, 2012 | Reply


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