[quote=joestool]
The only money that is double taxed is the extra amount of post tax money you are additionally paying back as interest to yourself. That extra amount of interest is paid back into your 401k to compound tax free until distribution.
[/quote]

Can’t you write off the interest paid as a tax deduction? This means, you deduct the interest at today’s tax rate, but pay deferred tax on it when you take it out, thus negating any double-taxing.

Cool thread. Interesting question. This sounds like an interesting way to get a fair return on your both your IRA investments and your mortgage.

I’m wondering if I can use a 20% interest rate to get more tax-deferred money into my IRA.

If you default on your own loan, can you foreclose and put the house in the IRA? Really – this is a fascinating topic.

By the way – is that Joe’s tool or Joe Stool ? I can’t say either are attractive usernames :O