I am sure this was probably answered somewhere on this forum, but I was unable to find it.

I took out a HELOC for $51K, and have payed IO payment on it during all of 2018. Not sure exactly what I used this money for, since I had cash in several accounts and didn't specifically earmark this $51K for any specific investment. I know I didn't improve/CapEx in my own home (I rent where I live). But I did use it for investment purposes - such as investing in a property or an apartment syndication. Is this interest deductible on my 2018 taxes. Thanks for taking your Friday (and weekend) to answer my question!

late night BUMP

Not that I'm aware of. The new wording of a heloc states must be used to improve the property in which the loan was originated from. 

Originally posted by @Kevin Barnard :

Not that I'm aware of. The new wording of a heloc states must be used to improve the property in which the loan was originated from. 

 Hmm.. I guess likely not then. How could one tell what money was used for what thing? It's all a mess of digits on a screen ;) Not really tangible or concrete stuff here..

Originally posted by @Andrey Y. :

How could 'the IRS' tell what money was used for what thing?

I edited your sentence above :) The answer is 'from your records'.  If you don't have the records to back up your deduction, best not to claim it.

@Andrey Y.

Interest needs to be traced to determine deductibility. Under interest tracing rules if used for business or investment then deductible.

I also discovered a great podcast and blog post on this topic.

Who Said All HELOC Interest Is No Longer Tax Deductible?

Who Said You Can’t Deduct HELOC Interest? – Interest Tracing Explained

@Andrey Y.

Since you rent, you probably will not be able to itemize your personal deductions. That kills a deduction against syndication K1 income.

Your only hope is a partial deduction against your investment property. This would require you to show money trail. Example: $51k got deposited into XXX account. Then 1/3 of it, $17k, was wired to the title company for purchasing YYY property. Then you can deduct 1/3 of the interest you paid against that property.

If your $51k was dissipated without careful tracking - then SOL, izvini.

Originally posted by @Michael Plaks :

@Andrey Y.

Since you rent, you probably will not be able to itemize your personal deductions. That kills a deduction against syndication K1 income.

Your only hope is a partial deduction against your investment property. This would require you to show money trail. Example: $51k got deposited into XXX account. Then 1/3 of it, $17k, was wired to the title company for purchasing YYY property. Then you can deduct 1/3 of the interest you paid against that property.

If your $51k was dissipated without careful tracking - then SOL, izvini.

 I actually wired $50,000 of the $51K to invest in a syndication. Would this count similarly to purchasing an investment property if I made it traceable?

it might be too late since I just submitted my 2018 taxes and the return was accepted. I guess if it was worth it I could ask for an amendment.

I have many syndication investments but all of them have been reporting pretty large paper losses, likely due to cost segregation in the first couple of years.

Originally posted by @Russell Roberts :

I also discovered a great podcast and blog post on this topic.

Who Said All HELOC Interest Is No Longer Tax Deductible?

Who Said You Can’t Deduct HELOC Interest? – Interest Tracing Explained

 Where were you yesterday before I submitted my H&R Block taxes? ;)

Originally posted by @Andrey Y. :

Originally posted by @Michael Plaks:

@Andrey Y.

Since you rent, you probably will not be able to itemize your personal deductions. That kills a deduction against syndication K1 income.

Your only hope is a partial deduction against your investment property. This would require you to show money trail. Example: $51k got deposited into XXX account. Then 1/3 of it, $17k, was wired to the title company for purchasing YYY property. Then you can deduct 1/3 of the interest you paid against that property.

If your $51k was dissipated without careful tracking - then SOL, izvini.

 I actually wired $50,000 of the $51K to invest in a syndication. Would this count similarly to purchasing an investment property if I made it traceable?

it might be too late since I just submitted my 2018 taxes and the return was accepted. I guess if it was worth it I could ask for an amendment.

I have many syndication investments but all of them have been reporting pretty large paper losses, likely due to cost segregation in the first couple of years.

 Syndication-related interest won't help you because you do not itemize your personal deductions.

Originally posted by @Michael Plaks :

Originally posted by @Andrey Y.:

Originally posted by @Michael Plaks:

@Andrey Y.

Since you rent, you probably will not be able to itemize your personal deductions. That kills a deduction against syndication K1 income.

Your only hope is a partial deduction against your investment property. This would require you to show money trail. Example: $51k got deposited into XXX account. Then 1/3 of it, $17k, was wired to the title company for purchasing YYY property. Then you can deduct 1/3 of the interest you paid against that property.

If your $51k was dissipated without careful tracking - then SOL, izvini.

 I actually wired $50,000 of the $51K to invest in a syndication. Would this count similarly to purchasing an investment property if I made it traceable?

it might be too late since I just submitted my 2018 taxes and the return was accepted. I guess if it was worth it I could ask for an amendment.

I have many syndication investments but all of them have been reporting pretty large paper losses, likely due to cost segregation in the first couple of years.

 Syndication-related interest won't help you because you do not itemize your personal deductions.

 Gotcha, thanks! Can't wait to go part time in medicine soon, maybe work a few 1099 locums 3-4 months out of the year, and nab that "real estate professional" designation :)

Lots of paper losses on syndications now that I feel like I'm not able to write much of them against my person income.

Still pretty confused on how the 'passive loss limitation' is phased out from $100K to $150K in AGI. This is probably becoming too much for me to tackle on my own. I do my best though ;)

Originally posted by @Andrey Y. :

 Gotcha, thanks! Can't wait to go part time in medicine soon, maybe work a few 1099 locums 3-4 months out of the year, and nab that "real estate professional" designation :)

Lots of paper losses on syndications now that I feel like I'm not able to write much of them against my person income.

Still pretty confused on how the 'passive loss limitation' is phased out from $100K to $150K in AGI. This is probably becoming too much for me to tackle on my own. I do my best though ;)

RE Pro will not help you with syndication losses. It's for properties you "materially participate" in, like your own rentals.