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ou and your friend just jointly purchased a new home for $1.5 million. You are paying a imple interest rate of 10% and thus with no principal paid in the year at the end of the year you pay $75,000 in interest expense. Your friend also pays the other $75,000 in interest. After 2017 how much of this is deductible as an itemized deduction on your return? O a. $25,000 O b. $100,000 O c. $125,000

ou and your friend just jointly purchased a new home for $1.5 million. You are paying a imple interest rate of 10% and thus with no principal paid in the year at the end of the year you pay $75,000 in interest expense. Your friend also pays the other $75,000 in interest. After 2017 how much of this is deductible as an itemized deduction on your return? O a. $25,000 O b. $100,000 O c. $125,000

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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You and your friend just jointly purchased a new home for $1.5 million. You are paying a simple interest rate of 10% and thus with no principal paid in the year at the end of the year you pay $75,000 in interest expense. Your friend also pays the other $75,000 in interest. After 2017 how much of this is deductible as an itemized deduction on your return? O a. $25,000 O b. $100,000 O c. $125,000 O d. $150,000 O e. $50,000 none because you don't believe in itemizing. O g. $75,000
Transcribed Image Text:You and your friend just jointly purchased a new home for $1.5 million. You are paying a simple interest rate of 10% and thus with no principal paid in the year at the end of the year you pay $75,000 in interest expense. Your friend also pays the other $75,000 in interest. After 2017 how much of this is deductible as an itemized deduction on your return? O a. $25,000 O b. $100,000 O c. $125,000 O d. $150,000 O e. $50,000 none because you don't believe in itemizing. O g. $75,000
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