Documentation Needed for Deducting HELOC Interest

[Carolyn McBride]

Hi BP Community! I'm looking to deduct HELOC interest for costs related to making improvements on a primary home that is also used as a rental. Does anyone know what type of documentation is needed to prove the HELOC funds are used for improvements to the property?

My HELOC lender does not allow electronic payments just checks, but because my contractors generally want straight cash or else electronic payment, I usually cash the checks myself and then send the payments electronically (which is not great from the perspective of my HELOC transaction history, since it looks like I was sending the money to myself only).

Please help! Anyone with experience around HELOC or home equity interest deductions, do let me know your experiences.

[Gary Faraon]

@Carolyn McBride greetings ma'am,

I do believe HELOC is a mortgage product therefore, u should get a statement from the bank. Findout what form is issued(bank) and ask the IRS where it is captured on the tax form. Quick google search i found on the 1040 tax return, schedule E,line 12. Someone correct me if I am wrong BP community.