Stoycho and Selen are married. Their marginal tax rate is 28%. They have the following investment income for 2015 and 2016:
____________________________________2015 __________2016
Interest on U.S. Treasury notes .............. $ 1,200 ............ $ 1,400
Cash dividends ................................... 3,000 .............. 2,200
Interest on savings ............................... 2,000 .............. 1,500
Interest on State of Montana bonds ............. 800 ................ 800
Net long-term capital gain ...................... 1,000 ................ 500
Their adjusted gross income before considering the investment income is $84,050 in 2015 and $73,500 in 2016. Stoycho and Selen pay $9,000 in investment interest in 2015 and $5,000 in 2016. The investment interest is incurred to acquire all the investments in their portfolio. Write a letter to Stoycho and Selen explaining how much investment interest they can deduct in 2015 and 2016.