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Question

RE: Interest and Dividend Income Offset with Line of Credit Interest

Forum|Forum|1 year ago
November 6, 2024
1 reply
0 views

I read that you can offset interest and dividend income with interest paid on a personal line of credit loan. To clarify, this is not a HELOC but a Schwab Pledged Assisted LoC or PAL. The loan will be used to help purchase a home but not secure it, i.e., no mortgage involved. Any help is greatly appreciated.

Thank you!

Employee

In most cases interest on a personal loan is not deductible on a tax return.

How did you use the proceeds from the loan?

freddytaxAuthor

The proceeds will be used to help purchase a new home. This is a bridge loan in that the proceeds from the sale of my current home will pay off the LoC loan. But I'm trying to plan ahead.

freddytaxAuthor

I found this on Experian:

You can't deduct an unsecured personal loan's interest on your taxes unless you use the loan's proceeds for one of the following purposes:

Business expenses
Qualified higher education expenses
Taxable investments