Plan Loans to Owners

[Gary]

If an owner of a company that sponsors a DB plan takes a loan to use as a down payment for a personal residence can the interest on such loan be deducted?

It is clear that in non home related matters the interest is not deductible, but in the above case I am not so sure.

Thanks.

[Belgarath]

Under IRC 72(p)(3), the interest deduction is denied if the loan is made to a key employee as defined in 416(i). So I think the owner is out of luck.