The cash you receive from your cash-out loan is not viewed as taxable income by the IRS. However, when using the money you receive from your cash-out loan, there are certain things to keep in mind for when you file your tax returns. Typically, if the money is being used for anything home-related (home improvements, expansions, etc.), the interest you pay on it might be deductible. This is because the IRS includes improvements that increase the value of your property as an interest tax-deductible option. On the flip-side, if you are using the money for other things such as paying credit card debt, putting into savings, or taking a trip, the interest is not tax-deductible. You can find more information from the IRA IRS in this publication.
This information is provided
for general informational purposes and should not be relied upon as tax or financial advice.Please contact your accountant or financial consultant
if you have specific questions about the money you take out
for a cash - out refinance loan.