Question
Amanda purchased a home for $860,000 in year 1. She paid $172,000 cash and borrowed the remaining $688,000. This is Amanda's only residence. Assume that
Amanda purchased a home for $860,000 in year 1. She paid $172,000 cash and borrowed the remaining $688,000. This is Amanda's only residence. Assume that in year 10 when the home had appreciated to $1,290,000 and the remaining mortgage was $516,000, interest rates declined and Amanda refinanced her home. She borrowed $860,000 at the time of the refinancing, paid off the first mortgage, and used the remainder for purposes unrelated to the home. What is her total amount of qualifying home-related debt for tax purposes?
$516,000.
$602,000.
$860,000.
$946,000.
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