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Updated over 5 years ago,

User Stats

34
Posts
30
Votes
Russell Roberts
  • Clarksville, TN
30
Votes |
34
Posts

Tax effect of personal residence cash out loan used for investing

Russell Roberts
  • Clarksville, TN
Posted

I did a cash out refinance on my primary residence in 2017.  I did Not use the loan proceeds to buy, build, or substantially improve my primary residence.  Instead, I used it to fund other real estate investments.  Some was used for down payment on single family rental properties.  Some was used to invest as limited partner in a larger syndication deal which provides me with a K-1. 


With the 2018 tax law changes, I understand that the interest expense no longer qualifies as deductible on my itemized federal income tax because I did not use the loan funds in a qualifying way (to improve the primary residence).

My question: Can I match up this personal residence interest expense against my investment property income from the single family rentals and K-1 returns?  That is exactly how I used those loan proceeds..    thanks for any advice.

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