Wayne and Maria purchase a home on April 1 of the current year.In order to obtain a thirty-year mortgage,they are required to pay $7,200 in points at closing.Charging points is a customary business practice in the area.In addition,they pay $4,400 of interest during the year.What is their current year deduction related to their home?
A)$4,400
B)$4,580
C)$7,200
D)$11,600

Question

Quizplus · Accepted Answer

Points paid on a mortgage for a primary residence are generally deductible in the year paid if they are customary in the area. Therefore, Wayne and Maria can deduct both the $7,200 in points and the $4,400 in interest, totaling $11,600.

Wayne and Maria Purchase a Home on April 1 of the Current