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Financial Planning / Tax Strategies


Subject:  Re: interest deduction Date:  11/5/1999  6:28 PM
Author:  ptheland Number:  20566 of 127518

This IRC stuff is really starting to bug me!

Boy, it is annoying sometimes, isn't it?

Okay, if the mortgage angle or the house as investment angle aren't kosher, can I just deduct the margin interest I'm being charged due to holding my stock position?

Well, yeah, that's kind of what happens. You report the investment interest, deduct up to your net investment income, then carry the rest over to next year. In the following year, you add the carry over to the current year's interest, deduct the allowable amount, and carry over again. When you decide to sell the stock (presumably with a big gain) the gain is part of the investment income and you'll use up most or all of the carryover.

Now for the planning ideas. If you used the margin loan to get a house, why don't you refinance the house, pay the margin loan, and deduct your interest now instead of later?
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