Helen,who is single,is considering purchasing a residence that will provide a $28,000 tax deduction for property taxes and mortgage interest.If her marginal tax rate is 25% and her effective tax rate is 20%,what is the amount of Helen's tax savings from purchasing the residence?
A)$5,600
B)$7,000
C)$21,000
D)$22,400

Question

Quizplus · Accepted Answer

B)$28,000 × .25 marginal rate = $7,000 tax savings.

Helen,who Is Single,is Considering Purchasing a Residence That Will Provide