T/p refinanced 425,000.00 home of 425,000 for a lower interest rate and cashed out the equity of 28,000. Home still remains at 425,000. Is the 28,000.00 taxable?

[Skylane]

No

[TaxGuyBill]

But if they took 'cash out' for things other than improving the home, then the deduction for mortgage interest must be prorated.

[dascpa]

Original loan as paid down, and as stated by someone else, increased only if for improvements to the residence.