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We purchased a rental property (with no mortgage) using private funds not purchased through a company. We want to add a first mortgage to the rental property and deduct to deduct the interest expense. If we use funds from the mortgage to buy a another rental property, what CRA forms to fill out to show that the mortgage was used to purchase another property. All my properties are under my name and not under a company/corporation.
There aren't any specific forms to fill out in order to trace the use of the funds received from the 1st mortgage. Should the CRA conduct an audit, provide them with bank statements that show how the funds were used.