Structuring Private Family Loans

[Dan C.]

I recently bought a cash-flowing duplex and SFH home. I am house-hacking the SFH and the split will be somewhere around 28% personal and 62% business. Some of the money I used was my own, but I also borrowed multiple times (all within a 1.5 month timelines from my parents to make this happen). They hold a lien on the SFH and we did a promissary note/private mortage agreement for 80% of the house although I used more than that from them towards the house. I am paying them a typical mortage fixed rate monthly. Before I make the first payment this month (and a little extra for the past months, we were putting it off to know the final amount), I want to know how it should all be structured in writing to make sure I can deduct all the interest for the duplex and as much as possible for the SFH considering a house-hack is not all business. The entire payment is interest as it is a interest only loan. My parents will be claiming these gains on their taxes of course.

How should I structure everything in writing? (besides the promissary note already signed and notarized)

Do I need to prove I used all of this money for business purposes to the IRS to be deducted?

How should I split the allocation between houses given the implication of the note below? (I have to know how much for each house so I can do the accounting correctly for the house-hack)

Is there any other question I should be asking?

I'm also looking for a CPA, EA to help me through this journey who is an investor themselves. Preferably someone who can do Indiana taxes and Florida when I move there eventually. If you have any recommendations, that would be awesome!

Thank you for your help and advice in advance!

Note: I will be keeping my parent's loan (amount on the promissary note and more) for the next couple of years on the SFH, but fixing up the duplex, refinancing it, paying them off for that portion by Feb/Mar 2023. I will be financing the remodel with my own money.