Good Day to Everyone tuning in.
Can anyone tell me if there are any restrcitions or tax liability on proceeds received from a mortgage (refinance with cash out) taken on a principlel residence in the US? Proceeds would be used to pay off a Canadian home equity loan. I would like to know how each country may treat the mortgage.
For tax purposes I'm considered a dual resident. I'm a also US citizen.
Due to personal and economic reasons I spend most of my time in the U.S. and have with ties in Canada.
Thank You
Mortgage (Refinance -Cash out)
Moderator: Mark T Serbinski CA CPA
I thouh tyou said you had a Green Card?
In any event, there is nothing special about what you are doing.
For Cdn purposes, for the mortgage interst to be tax deductible, the money must be used to produce income, not on your residence. So it matters very much what you used the money for.
In the US, any mortgage or loan secured on your home(s) is eligible for interest tax deduction. It doesn't matter what you used the money for. And it doesn'yt matter if the property is in Canada.
So, in your case the interest will continue to be tax deductible on your 1040 (so was the Cdn home equity loan, by the way), and none of the interest will be tax deductible in Canada, unless this home equity loan had been used on investments.
In any event, there is nothing special about what you are doing.
For Cdn purposes, for the mortgage interst to be tax deductible, the money must be used to produce income, not on your residence. So it matters very much what you used the money for.
In the US, any mortgage or loan secured on your home(s) is eligible for interest tax deduction. It doesn't matter what you used the money for. And it doesn'yt matter if the property is in Canada.
So, in your case the interest will continue to be tax deductible on your 1040 (so was the Cdn home equity loan, by the way), and none of the interest will be tax deductible in Canada, unless this home equity loan had been used on investments.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing 
Nelsona, Thank You!!. Your input is very much appreciated by me and Im sure everyone else who visits this forum.
Due to different interest compounding methods between US and Cnd mortgage institutes I think I'm better off working with a Canadian insitute. I have significant equity built in both properties.
Again Thank You
Due to different interest compounding methods between US and Cnd mortgage institutes I think I'm better off working with a Canadian insitute. I have significant equity built in both properties.
Again Thank You