Diane owns a principal residence in Georgia, a townhouse in San Francisco, and a yacht in Cape Cod. All of the properties have mortgages on which Diane pays interest.

a. For which residences can Diane deduct mortgage interest?

b. What are the limitations on Dianes mortgage interest deduction? What strategy should Diane consider to maximize her mortgage interest deduction?

Diane's deduction is limited to interest on acquisition indebtedness up to $_____ if the debt existed at December 15, 2017 or $ if incurred after that date. Therefore, she should choose the second residence that will result in the _____ interest deduction.