Need help with a decision on keeping a HELOC vs. cash-out REFI?

[Mike Shemp]

Hi All,

We recently closed on a short-term rental property.  We paid cash for it using our own personal funds, along with funds from a HELOC on another personal/vacation property that we do not rent out.

From a tax-perspective, does it matter if we keep the heloc in place and write-off the interest personally, or should we think about doing a cash-out refi on the place we just closed on to have the interest associated with the rental property, and pay-off the HELOC?

Thanks in advance for any thoughts.
Mike