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Original Fast Forward Academy test bank question:
Jean and Robert have total wages of $95,000 plus interest income of $3,000 and dividends of $2,000. They paid mortgage interest of $7,000, car loan interest of $2,000, mobile home interest of $4,000, personal loan interest of $1,000 and margin interest of $6,000. How much interest can Jean and Robert deduct on Schedule A?
Home mortgage and second (mobile) home mortgage interest are deductible, as is $5,000 of the $6,000 investment interest (investment interest deductible up to the amount of taxable income received from the investment) per Pub 529. Interest on a personal or car loan is not deductible.
FFA RTRP Book Reference: CH 6 Standard and Itemized Deductions Subsection: Itemized deductions Subject: Interest expense (e.g., mortgage interest, investment interest, tracing rules, points) Correct Answer: A
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