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borrowing the remaining $800,000 with a 6 percent loan secured by the home. The Sanchezes made in payments on the loan in years 1 and 2. (Leave no answer blank. Enter zero if applicable.) ume year 1 is 2021 and by the beginning of year 4, the Sanchezes have paid down the principal amount r 4, they borrow an additional $100,000 through a loan secured by the home in order to finish their base sa 7 percent interest rate and is termed a "home equity loan" by the lender. What amount of interest car $100,000 loan?

borrowing the remaining $800,000 with a 6 percent loan secured by the home. The Sanchezes made in payments on the loan in years 1 and 2. (Leave no answer blank. Enter zero if applicable.) ume year 1 is 2021 and by the beginning of year 4, the Sanchezes have paid down the principal amount r 4, they borrow an additional $100,000 through a loan secured by the home in order to finish their base sa 7 percent interest rate and is termed a "home equity loan" by the lender. What amount of interest car $100,000 loan?

SWFT Comprehensive Vol 2020
SWFT Comprehensive Vol 2020
43rd Edition
ISBN:9780357391723
Author:Maloney
Publisher:Maloney
Chapter6: Deductions And Losses: In General
Section: Chapter Questions
Problem 25DQ
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Javier and Anita Sanchez purchased a home on January 1 of year 1 for $1,000,000 by paying $200,000 down and borrowing the remaining $800,000 with a 6 percent loan secured by the home. The Sanchezes made interest-only payments on the loan in years 1 and 2. (Leave no answer blank. Enter zero if applicable.) c. Assume year 1 is 2021 and by the beginning of year 4, the Sanchezes have paid down the principal amount of the loan to $500,000. In year 4, they borrow an additional $100,000 through a loan secured by the home in order to finish their basement. The new loan carries a 7 percent interest rate and is termed a “home equity loan" by the lender. What amount of interest can the Sanchezes deduct on the $100,000 loan? Maximum deductible interest expense
Transcribed Image Text:Javier and Anita Sanchez purchased a home on January 1 of year 1 for $1,000,000 by paying $200,000 down and borrowing the remaining $800,000 with a 6 percent loan secured by the home. The Sanchezes made interest-only payments on the loan in years 1 and 2. (Leave no answer blank. Enter zero if applicable.) c. Assume year 1 is 2021 and by the beginning of year 4, the Sanchezes have paid down the principal amount of the loan to $500,000. In year 4, they borrow an additional $100,000 through a loan secured by the home in order to finish their basement. The new loan carries a 7 percent interest rate and is termed a “home equity loan" by the lender. What amount of interest can the Sanchezes deduct on the $100,000 loan? Maximum deductible interest expense
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