My client has a mortgage on vacant land. Is that interest regarded as investment interest and thus only deductible to the amount of rental income?

[sjrcpa · Accepted solution]

Investment interest is deductible to the extent of investment income. i don't think rent counts as investment income.

[itonewbie]

I though the OP meant it could be deducted if that piece of land was rented out but agree with you in that context.

[sjrcpa]

It is hard to tell what OP meant.

[itonewbie]

Yes but your client may elect to capitalize that as part of the carrying charges under §266.