home mortgage interest question ?
I know that the interest on a home mortgage is deductible up to $1 million
of acquisition cost and $100k equity, but my question is this... can I
deduct all the interest on an equity line of credit (secured by a lien
against my home) even though the total mortgage and equity line of credit
exceeds the value of my home. I just bought a house about a year ago, so I
have very little real equity and I wanted to consolidate some debt.
No, only the amount up to your mortgage is deductible.
No. Interest on loans exceeding the FMV of the property is not deductible.
IRS has expressed interest in this as an audit issue in light of the slew of
ads about "125%" loans.