Can the interest from a HELOC be written off on taxes?

[edprush]

I understand that the interest on a mortgage payment can be written off on your taxes but what about the interest on a home equity line of credit--I plan to use the HELOC to pay off the balance of the home purchase to the seller. I paid 70% of the home value as down payment to the seller. I owe 30% and would like to get a HELOC to pay the remainder.

Can I write off the HELOC interest?

Thanks.

 

[Hammer]

yes

 

[Hammer]

as long as its under 100k i believe

 

[edprush]

How does the IRS know that I used the HELOC to pay-off the house and not to pay for lap-dances?

I would think they would need proof that the loan was used towards the house...or don't they.

 

[DrPizza]

That's one of the advantages.
However, afaik, you can only write off the interest if you itemize. Make sure your situation will result in a larger tax return by itemizing.

 

[dirtboy]

Originally posted by: edprush
How does the IRS know that I used the HELOC to pay-off the house and not to pay for lap-dances?

I would think they would need proof that the loan was used towards the house...or don't they.

They don't

and

they don't.