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$5,250 of interest on a $105,000 home nterest on a mortgage on his vacation h Healy's AGI is $220,000. How much int

$5,250 of interest on a $105,000 home nterest on a mortgage on his vacation h Healy's AGI is $220,000. How much int

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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This year, Major Healy paid $34,500 of interest on a mortgage on his home (he borrowed $690,000 to buy the residence in 2015; $790,000 original purchase price and value at purchase), $5,250 of interest on a $105,000 home equity loan on his home (loan proceeds were used to buy antique cars), and $7,000 of interest on a mortgage on his vacation home (borrowed $140,000 to purchase the home in 2010; home purchased for $350,000). Major Healy’s AGI is $220,000. How much interest expense can Major Healy deduct as an itemized deduction? The diagram contains a blue box labeled "Interest Deductible" with an arrow pointing right, but without any additional information or content.
Transcribed Image Text:This year, Major Healy paid $34,500 of interest on a mortgage on his home (he borrowed $690,000 to buy the residence in 2015; $790,000 original purchase price and value at purchase), $5,250 of interest on a $105,000 home equity loan on his home (loan proceeds were used to buy antique cars), and $7,000 of interest on a mortgage on his vacation home (borrowed $140,000 to purchase the home in 2010; home purchased for $350,000). Major Healy’s AGI is $220,000. How much interest expense can Major Healy deduct as an itemized deduction? The diagram contains a blue box labeled "Interest Deductible" with an arrow pointing right, but without any additional information or content.
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