Tax consequences of Loan consolidation

[James Boro]

Hey everyone! I'm looking for a little help and I'm hoping someone around here can provide some insight. I'll detail my situation here.

I am looking to purchase a new primary residence ASAP. I currently have 10 first mortgages (residential) +1 for my primary residence. The conventional loan max is 10+1.

In order to finance a new primary residence, I will need to reduce my loan count by 1.

I'm hoping to do the following:

Cash-out refinance Property A, with a new, bigger first mortgage.

Take the proceeds from Property A and pay off Property B.

So, In summary, instead of having two small loans on Property A and Property B, I will have one big loan on Property A.

I have presented this idea with my CPA, and I was told the cash-out portion of the refinance would not be tax deductible because cash-out refinances must be applied to improvements on the same property.

I reached out to a second CPA for another opinion, and they were not aware of any reason why the interest on the cash-out refinance would not be tax deductible as long as the funds were used to pay off a purchase mortgage on another rental property.

That's where you come in :).

I would like to hear your opinion on the matter, or some possible ideas on how to reduce my loan count by 1 (other than paying it off with cash).