Mr. and Mrs. Perry own three homes, each of which is subject to a mortgage incurred to purchase the home. The mortgage on their principal residence is $290,000, the mortgage on the second home is $100,000, and the mortgage on the third home is $317,000. Which of the following statements is true?

Question

Quizplus · Accepted Answer

Under U.S. tax law, taxpayers can deduct mortgage interest on the first $750,000 ($375,000 if married filing separately) of indebtedness on their principal residence and one other residence. Since the Perrys have mortgages on three homes, they cannot deduct the interest on all three mortgages under this provision. The statements provided do not accurately reflect the limitations or allowances under the tax code for mortgage interest deductions, hence none of the statements are true.

Mr and Mrs