Question: Jill and George are married and file a joint return. They expect to have $425,000 of taxable income in the next year and are considering

Jill and George are married and file a joint return. They expect to have $425,000 of taxable income in the next year and are considering whether to purchase a personal residence that would provide additional tax deductions of $80,000 for mortgage interest and real estate taxes.

a. What is their marginal tax rate for purposes of making this decision?

b. What is the tax savings if the residence is acquired?

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a Their marginal tax rate with 425000 of taxable income is 35 However with an addition... View full answer

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