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12 August, 01:43

Patricia purchased a home on January 1, year 1 for $1,250,000 by making a down payment of $100,000 and financing the remaining $1,150,000 with a 30-year loan, secured by the residence, at 6%. During year 1, Patricia made interest-only payments on the loan of $69,000. What amount of the $69,000 interest expense Patricia paid during year 1 may she deduct as an itemized deduction?

A. $63,000

B. $60,000

C. $45,000

D. $66,000

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  1. 12 August, 01:51
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    B. $60,000

    Explanation:

    Deduction is only available only up to amount $1,000,000

    Interest on such amount = $1,000,000*6%

    = $60,0000

    Only $60,000 out of $69,000 is available for deduction.
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