Home Equity Loan Tip
Use A Home Equity Loan To Convert Non-Deductible Loans Into Tax-deductible Interest:
If you pay non-deductible interest on a auto loan, credit cards, student loan or personal loan up to $100,000 total, obtaining a Home Equity Line of Credit (known as a HELOC) can convert that non-deductible loan interest into tax-deductible home equity interest when you pay off those loans.
Banks, credit unions and other lenders are eager to make you a home equity loan. For some unexplained reason, the default on home equity loans is virtually zero. Interest on such loans, up to $100,000, is tax-deductible as itemized interest.
However, if the purpose of your home equity loan is to use the funds for home improvements or in your business, there's no limit to the interest deductibility on your business tax returns.
If you pay non-deductible interest on a auto loan, credit cards, student loan or personal loan up to $100,000 total, obtaining a Home Equity Line of Credit (known as a HELOC) can convert that non-deductible loan interest into tax-deductible home equity interest when you pay off those loans.
Banks, credit unions and other lenders are eager to make you a home equity loan. For some unexplained reason, the default on home equity loans is virtually zero. Interest on such loans, up to $100,000, is tax-deductible as itemized interest.
However, if the purpose of your home equity loan is to use the funds for home improvements or in your business, there's no limit to the interest deductibility on your business tax returns.
posted by The Prof at 3:30 PM
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