Question
Faith takes out a $250000 home equity loan and secures the loan with her main home. she withdraws $50000 in cash to buy stocks .
Faith takes out a $250000 home equity loan and secures the loan with her main home. she withdraws $50000 in cash to buy stocks . which of the following is correct based on interest tracing rules ?
a) Faith can deduct the interest attributable to the purchase of the stocks as home mortgage interest since the loan is secured by her main home . the interest is fully deductible on schedule A.
b)Faith can not deduct the interest attributable to the purchase of the stocks because it is considered personal interest , therefore, not deductible.
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The detailed answer for the above question is provided below b Faith cannot deduct the interest ...Get Instant Access to Expert-Tailored Solutions
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Get StartedRecommended Textbook for
Fundamentals of Investments, Valuation and Management
Authors: Bradford Jordan, Thomas Miller, Steve Dolvin
8th edition
1259720697, 1259720691, 1260109437, 9781260109436, 978-1259720697
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