Margin Interest Deduction

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JustAsking
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Joined: Mon Aug 25, 2008 3:01 am

Margin Interest Deduction

Post by JustAsking » Sun Apr 01, 2018 4:05 pm

Interest we pay on margin loans is tax-deductible if the loan is used to buy (taxable) securities but not if it's taken for personal use, i.e., a cash advance. Is there a way to calculate from brokerage statements the amount of margin interest paid for each category? It's not as simple as a ratio of one to the other, since investment income each month repays some of the indebtedness, as do any deposits to the account, and I don't know how those amounts are apportioned. Also, interest is calculated on a daily basis, starting the day the loan is taken, so it's not always for a full month.
"In theory, there is no difference between theory and practice, but in practice there is." -- Jan L.A. van de Snepscheut (1953-1994), late of CalTech

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