Natasha and Al received a statement reporting that they paid $8,000 in mortgage interest during the past year. If they are in a 28 percent tax bracket, this deduction may reduce their taxable income by:
A) $1,000.
B) $2,240.
C) $3,000.
D) $4,000.
E) $8,000.
Taxable income is reduced by the $8,000 of mortgage interest.

Question

Quizplus · Accepted Answer

The mortgage interest deduction reduces taxable income by the full amount of the interest paid, which is $8,000.

Natasha and Al Received a Statement Reporting That They Paid