My_question_is: Canadian-specific
Subject: Vacation house in the Washington State, USA
Expert: taxman at centa.com
Date: Thursday December 16, 2004
Time: 04:53 PM -0800
QUESTION:
Last Nov 2003, I bought a house in Blaine Wa. I paid $175,000 USD in full,
I borrowed $230,000 CAD from my home equity line on my residence in Richmond
BC. Can I deduct the mortgage interest on my Income Tax Return? I am a
Canadian citizen. I did not have a mortgage on my residence until I bought
the above mentioned property in Washington USA. I borrowed to buy an
investment property. Thank you.
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david ingram replies:
If this was an investment property and rented out, the Canadian interest
would be deductible on Schedule E of the US 1040 NR return you would have to
file and Schedule T776 which would be attached to your T1-General Canadian
return to report the rental income.
However, I believe that you are not renting it out because the subject
matter on the line says vacation property and the mortgage interest to
purchase a vacation property is not deductible in Canada although it is
deductible for an American on their vacation properties whether in Canada or
the US or Mexico or Spain.
You can find out more about mortgage interest as a deduction by reading the
Nov 2001 newsletter at www.centa.com. In addition, you can attend our free
seminars on the subject at Fred Snyder's office at 1764 West 7th as follows:
Every Thursday evening Fred Snyder and I hold a free seminar at Fred's
office at 1764 West 7th (corner of Burrard in the Spence Diamond building)
in Vancouver.
The topics are:
Seg funds and an alternative to the traditional RRSP.
Making your mortgage income tax deductible
Critical Care insurance for disasters.
coffee and cookies of course.
Phone 604-731-8900 to reserve your seat -and, you are welcome to bring your
brother, your sister, your mother or father, your children, your best
friend, your worst enemy or your own financial advisor who hasn't explained
how to make your mortgage deductible.
And Remember
Answers to this and other similar questions can be obtained free on Air
every Sunday morning.
Every Sunday at 9:00 AM on 600AM in Vancouver, Fred Snyder of Dundee Wealth
Management and I, David Ingram will be hosting an INFOMERCIAL but LIVE talk
show called "ITS YOUR MONEY"
Those outside of the Lower Mainland will be able to listen on the internet
at
www.600AM.com <http://www.600am.com/>
Local calls are taken at (604) 280-0600 and Long Distance calls are taken at
1( 866) 778-0600
I do not know how far the LD line reaches.
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