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Borrowed money is never taxable income.
(Whenever you get a loan you are getting "cash out" and putting the property up as collateral).
You don't pay tax on taking out your own savings, which is what the equity in your house is...but you will, (actually may) pay it when you sell the house.
Buy a house for 100K, using a 100K mortgage...no tax.
Later borrow 20K additional. No tax.
Later sell it for 150K, pay off the loans, pay tax on the 50K you made, (although you'll only have 30K in your pocket at this point, after paying back the 120K of loans).
== I just have to say that you should reconsider if you are cashing out all of your equity. This is a changing market and you may end up with a higher payment on a loan that is higher than the value of your house. Credit card debt and car payments should not be paid using the value of your home--it will not get you ahead in the long run.
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