The deduction is the same as would be for any mortgage; that is, you get a deduction for actual interest paid.
By "home equity loan", I assume you actually mean a home equity line of credit (HELOC). That is, you have a line of credit, of which you're usually required to take a certain amount at the time the loan is closed, but you can borrow up to your line of credit for a certain term and you can also repay in full at any time after a specified date. So the balance can go up and down.
The thing to remember about mortgage interest in general is that your tax savings depends on your tax bracket. So if you're in the 25 percent marginal tax rate bracket, your tax is reduced by 25 cents for every dollar you pay in interest. In other words, don't draw any more from your HELOC than you actually need. If you were going to purchase something with a credit card at, say 12 percent interest, then it makes sense to use your HELOC that charges 3 percent interest instead, even without the tax deduction. On the other hand, if you can get a car loan for 2.5 percent interest it wouldn't make sense to use a 3 percent HELOC to buy a car unless you're in a very high tax bracket.
We sell tractor parts! We have the parts you need to repair your tractor - the right parts. Our low prices and years of research make us your best choice when you need parts. Shop Online Today. [ About Us ]
Today's Featured Article - Harvestin Hay: The Early Years (Part 2) - by Pat Browning. The summer of 1950 was the start of a new era in farming for our family. I was thirteen, and Kathy (my oldest sister) was seven. At this age, I believed tractor farming was the only way, hot stuff -- and given a chance I probably would have used the tractor, Dad's first, a 1936 Model "A" John Deere, to go bring in the cows! And I think Dad was ready for some automation too. And so it was that we acquired a good, used J. I. Case, wire tie hay baler. In addition to a person to drive th
... [Read Article]
All Rights Reserved. Reproduction of any part of this website, including design and content, without written permission is strictly prohibited. Trade Marks and Trade Names contained and used in this Website are those of others, and are used in this Website in a descriptive sense to refer to the products of others. Use of this Web site constitutes acceptance of our User Agreement and Privacy Policy
TRADEMARK DISCLAIMER: Tradenames and Trademarks referred to within Yesterday's Tractor Co. products and within the Yesterday's Tractor Co. websites are the property of their respective trademark holders. None of these trademark holders are affiliated with Yesterday's Tractor Co., our products, or our website nor are we sponsored by them. John Deere and its logos are the registered trademarks of the John Deere Corporation. Agco, Agco Allis, White, Massey Ferguson and their logos are the registered trademarks of AGCO Corporation. Case, Case-IH, Farmall, International Harvester, New Holland and their logos are registered trademarks of CNH Global N.V.
