Cashout refinance interest

[Amol K.]

Could you please let me know if the interest in Step 5 below would be tax deductible:

1) Buy Property for $100k. $20k cash down, and $80k loan (for simplicity, say interest-only)

2) Property appreciates to $150k

3) Refinance to 80% LTV ($120k loan)

4) Use proceeds to pay off loan in 1) and reimburse myself the $20k I had put in

5) Is the entire interest on the $120k loan tax deductible?