Investment interest may be deducted only to the extent of net investment income; interest that cannot be deducted because of this limitation is carried over to the next tax year and treated as having been paid in that year.

Question

Quizplus · Accepted Answer

This is true. According to IRS rules, investment interest can only be deducted up to the amount of net investment income. If the interest exceeds the income, the excess interest can be carried over to the following tax year to be deducted then.

Investment Interest May Be Deducted Only to the Extent of Net