Refinance to buy RV- Mortgage interest question

[nwtaxlady]

Client refinanced his personal residence back in a prior year... say 2016 and took out $75,000 equity to buy a motorhome. So for 2018 taxes, is that portion deductible? Or not since it was not acquisition debt?
I tried looking for this info in TTB didn't see anything that is specific to this situation.

[Dude]

It's not an RV. It's a second residence because at $75,000 I assume it has a kitchen and a bathroom. As long as the two loans don't exceed $750k

[TAXNJ]

Client refinanced his personal residence back in a prior year... say 2016 and took out $75,000 equity to buy a motorhome. So for 2018 taxes, is that portion deductible? Or not since it was not acquisition debt?
I tried looking for this info in TTB didn't see anything that is specific to this situation.

See TTB starting at 4-10 (chart on 4-10) for deductibility and other requirements if applies to your scenario.

Qualified Home
A qualified home is the taxpayer’s main home or a second home. A home includes a house, condominium, cooperative, mobile home, house trailer, boat, or similar property that has sleeping, cooking, and toilet facilities

[TaxGuyBill]

I would need to look it up, but I kind-of remember that it may fall into a "gray area".

When you read the Code, it says the loan must be "secured by such residence". If I remember correctly, there was some debate whether or not the loan had to be against ANY qualified residence, or if the loan had to be against THAT residence.

[nwtaxlady]

I would need to look it up, but I kind-of remember that it may fall into a "gray area".

When you read the Code, it says the loan must be "secured by such residence". If I remember correctly, there was some debate whether or not the loan had to be against ANY qualified residence, or if the loan had to be against THAT residence.

I agree with you TAXGUYBILL

I had been to a tax seminar and that was one of the big changes for the NEW mortgage interest rules. They indicated that the RV would have to have it's own loan thru a bank where the bank holds the title. So just like you said, the loan had to be against THAT residence.

I just can't find my notes on that, and wanted to confirm what I remembered was correct. And see if anyone else had a site for me to go to. Can you let me know what you find please.

[terryats]

I agree with Dude. from Pub 936 Qualified Home

For you to take a home mortgage interest de-duction, your debt must be secured by a qualified home. This means your main home or your second home. A home includes a house, con-dominium, cooperative, mobile home, house trailer, boat, or similar property that has sleeping, cooking, and toilet facilities.

The interest you pay on a mortgage on a home other than your main or second home may be deductible if the proceeds of the loan were used for business, investment, or other deductible purposes. Otherwise, it is considered personal interest and isn't deductible.

Main home. You can have only one main home at any one time. This is the home where you ordinarily live most of the time.

Second home. A second home is a home that you choose to treat as your second home