Can a cash-out refinance mortgage on one property be written off from another?

[Aaron Knoll]

Two questions, for those in the know:

1. I currently own my house in full, mortgage. It would appraise at roughly $300k.

I'm considering buying a new property (currently rented out), refinancing this house by taking out a $180k loan on it. In addition, I'd take out a smaller mortgage on the rental property. 

When I read the IRS rules, my understanding is that *any* loan used to purchase investment property can have interested/points deducted from rental. So in theory, I could deduct both mortgages' interest from rental income on the new property -- is that correct?

Next: sometime 2--3 years from now, we would occupy the rental house and rent out (or sell) our current house. Would writing off *both* mortgages from the new rental investment prevent us from writing off either of them on our current house, should we ultimately rent that out?

2. How is building cost (for depreciation) assessed? Is it based on tax value of the property, or on "cost of building replacement" for insurance? Or neither?

Thanks!