Question: in each of the following cases indicate the amount of...
In each of the following cases, indicate the amount of the deduction for the current year. In each case, assume the taxpayer is a calendar year, cash basis taxpayer.
- On December 31, P, wishing to reduce his current year’s tax liability, prepaid $3,000 of interest on his home mortgage for the first three months of the following taxable year.
- On December 1 of this year, T obtained a $100,000 loan to purchase her residence . The loan was secured by the residence. She paid two points to obtain the loan bearing a 6% interest rate.
- Same as (b) except the loan was used to purchase a duplex, which she will rent to others. The loan was secured by the duplex.