Deduction of Interest Expenses

suarezn

Gold
Feb 3, 2002
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OK, just wondered if anyone knew anything about this. Currently have a mortgage in The DR with a Dominican bank. Wondering if this interest can be deductible here in US. Normally the interest paid on a second home can be deducted on your taxes. As far as I know there's no rule as to where this second residence has to be. The issue as I see it is that the DR bank is not going to provide the US with a 1098 form, they have no federal tax ID that I know of, etc...but it seems like The US government would try to get some of that interest. If anyone knows i would appreciate any insight on this.
 
Jan 17, 2009
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You're right, there's nothing that defines that the home has to be located in the US. But, if I were you, I would contact a tax specialist. Remember that once you do this, you'll have to declare capital gains on the sale of the home and that's taxable (no exclusion for second home). You may be saving now but may lose big time in a few years. IMO